Are Forex Signals Service Pip Numbers All That Are Important?

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Using a Foreign Exchange signals provider is a simple solution for people who don’t want to go through the long learning curve of learning to trade currency, or lack the time necessary to look for trade setups due to a busy schedule. And when seeking a Foreign Exchange signals provider to subscribe to, it is the Forex signals proof that is most important. Without a doubt, you want to subscribe to a successful signals service that can prove their signals are profitable.

Does Higher Pip Numbers Mean More Money?

In most cases, signals service results are given in terms of pips won or lost. This leads many people to believe the more pips the better. Unfortunately, just knowing the pips gained or lost is not enough information to effectively rate the Forex signals provider.

The pip value is going to be determined by your account balance, the number of pips in the stop loss and the money management strategy used to calculate the lot size you are going to use. It is very possible a signals service reporting 200-300 pips a month can be much more profitable than a signals service showing 1000 pips a month. Make sure to study how the size of the stop loss and money management effect the profitability of the service before deciding using only average monthly pip numbers.

How much a pip is worth is determined by the lot size you use when placing the trade. The lot size differs for each trader depending on their account balance and the risk management formula they use to determine lot size. This needs to be taken into account when determining the profitability of a Forex signals service.

Think about placing a trade with a 20 pip stop loss. The lot size you are going to use should be very different than if you were placing a trade with a 200 pip stop loss. For example, if you were to use 0.1 lots, you would be putting at risk about $20 on the first trade, but that would equal $200 at risk for the second.

The point I am trying to make is that pip numbers by themselves are not enough information to evaluate a Foreign Exchange signals provider. You really need to look deeper into the results of the service. Only then can you make an informed decision about which Forex signals provider can make you the most money.

Set And Forget Forex Signals reports an average between 200 and 300 pips a month. While this might not seem like a lot, you can make nice profits with this service. Instead of just reporting pip numbers, they provide money management case studies so you can see the results of different lot sizes. You might be surprised at how profitable this Forex signals service can be.

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