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What is trade management?
Trade management is everything a trader does after a trade is open until the trade is closed. By managing trades, traders can increase their profits, whilst minimising risk. Trade management involves tasks such as determining position size, monitoring the trade and executing exits.

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Why is trade management important?
When you open a trade one of two things will happen. Either:

You will close the trade, or
The trade will close you
Closing the trade on your terms is far more preferable than having the trade closed out because you can’t stomach the loss any more (capitulation) or because you’re margin called and forced out.

This is why managing the trade at all times is necessary if traders want to make more money.

However, you should be careful that you are not ‘over-managing’ your trades. This is when traders are actually causing themselves harm by meddling with trades. By keeping a log of how trades would’ve played out had you not optimised the trade then you can see whether or not your actions and contributing to P&L.

For example, if you are finding that by closing your trades you are costing yourself capital on trades that would be closed at a higher price, then the solution is simple: stop overriding your targets.

Here are six trade management strategies for you to improve your trading.

6 trade management strategies for better results

1.Manage your position size
2.Focus on your timeframe
3.Evaluate potential trading scenarios
4.Manage your stop losses and limit orders
5.Use different accounts for different trading strategies
6.Remove P&L from your trading platform