Hi! If we haven’t met, I’m Sam Eder. I’m the co-founder and ceo of MarketMates
In my professional experience, looking behind the scenes at thousands of trading accounts, I saw many traders who over-complicated things.
They took too many trades across multiple markets at once, with excessive leverage.
Inevitably this approach led to confusion, frustration, and avoidable losses.
This is the story of how I developed my best forex trading strategy through my experience working at global brokerages over many years.
How I gained my unique insight
I started working for global brokerages in 2008. My job involved the opportunity to see statistics about thousands of retail traders’ trading accounts.
It’s this unique view that helped me understand what the majority of traders were doing wrong. It gave me clear insight into what the successful ones were doing differently.
It became clear to me that the best forex trading strategy is a very simple one, free of the clutter of multiple markets and forex pairs.
That’s why, when we started MarketMates, I felt it was important to teach our traders a less complicated approach — taking one trade at a time, in one market, with one pattern, and one per cent or less risk per trade.
The Rule of One
I call this simple forex trading strategy ‘The Rule of One.’ It has become my best, most successful strategy for forex trading over the years.
It’s a production line approach to trading, where you repeat the same process day-after-day.
It’s an approach that can yield consistent returns, and yet it is simple to trade and monitor, even if you lead a busy life.
By becoming a rules-based trader using this simple and uncomplicated method, I’ve averaged a steady 3% monthly return over the past few years (I practice what we preach!)
Last month, my simple forex trading strategy returned 17.4 times my risk per trade (17.4R) or 8.7%, well ahead of my goal of 6R (or 3%) a month.
In this article, I’ll walk you through exactly what I did, including a breakdown of each and every trade so you can see how this works.
The ‘Production Line’ approach
This approach to forex trading is straightforward. You repeat the same pattern over and over again – like a production line.
It’s a method that is very suitable as a forex trading strategy for beginners, and yet it also suits experienced traders too.
Here’s the details of my simple but effective best trading strategy:
- I trade only USD/JPY on the 15-minute chart
- I trade in the direction of the long-term trend
- I enter breakouts from periods of low volatility (when USD/JPY is coiled tight like a spring)
- I use a 1.5 ATR stop-loss
- I set a profit target of five times my risk
- I break the trade into three parts: one part exits at the target, one when the market looks like it will reverse, and the final part on a trailing stop
- I take a maximum of two trades a day
- I only ever have one trade open at a time
The key to this strategy is it cuts losses quickly and lets profits run.
Trading as a science experiment
Running a forex trading strategy is like conducting a science experiment. You won’t get it perfect on day one.
You start with an idea, test it, record your results, analyse, adjust, and test again until you reach your goals.
This is the process I used to continually evolve my trading strategy.
Next, the focus should be on execution: sticking perfectly to the plan.
Almost all of my losing months have stemmed from mistakes. By ‘mistakes,’ I mean not following my plan exactly.
This is why I’m going through ‘Season of 100’ – which is 100 days exactly following my trading rules.
It’s a way to focus on the simple trading disciplines and hold myself accountable.
Risk management tactics
The first part of any successful trading strategy is a strong risk management plan. Your risk management plan should be based on your objectives.
What the right objective is for you is a deeply personal question. For some people, 3% a month may seem small, for others it may seem incredible.
At MarketMates, we teach a slow and steady approach where you compound your gains.
If you do this for long enough, one day you could wake up with a large trading account. The graph below illustrates the power of compounding gains.
What’s important to remember is that you are not in a race with anyone else.
What matters is that you are clear on your objectives and have a plan to achieve them.
You are the hero of your own journey, and it does not serve to judge yourself against others.
Determine your trading objectives
Objectives include a target for returns and the maximum amount you are willing to risk.
For example
- I risk 0.5% of my account per trade
- I limit monthly losses to 6R (3%)
- I target an average of 3% a month, with a stretch goal of >9%.
Having a small risk, big gain mindset— such as losing no more than 3% in a bad month with the potential to make much more in a winning month—is how I maintain consistent returns over time.
Too often I see traders who are poor risk managers, yet they think their poor results are because they need a better entry strategy.
This is why so many traders fail – because their focus is in the wrong place.
You have no control over what the financial markets are going to do. However, risk management is within your control.
It’s a simple maths puzzle to work out how much to risk per trade in order to stick to your objectives.
Once you do this, it gives you great confidence, knowing you have control over your risk.
Here’s a slide deck of every trade I took in a month,, with my comments. You can also watch the full breakdown in the video above, or view all the trades on a page, or download them here.
Here are the indicators I use for this strategy. Some are custom-developed—you can access them for FREE from MarketMates.
Here are some performance stats for my trading during this month:
- R-multiples: +17.4
- Per cent return 8.7%
- Trades: 29
- Win rate: 41%
- Average risk/reward ratio: 2.85
- Expectancy: 0.6
- Cost of mistakes: -4R or -2%
A simple, focused strategy is all you need
Mastering one market, one pattern, with one percent or less risk per trade can be all you need to achieve consistent results in trading.
Simplicity often leads to success.
In my time working for brokers I’ve seen plenty of good traders. The overwhelming majority of them use a deceptively simple strategy.
One large trader I knew would only trade EUR/JPY, another only the NASDAQ. Working in Asia, I saw several good traders who would focus on nothing but gold.
They keep their strategy focused and their minds clear.
They only risk a small fraction of their account on each trade, and cut losses quickly if trades go against them.
These aren’t professional traders but everyday people with full-time jobs who understand that keeping things simple allows for consistent, objective decisions, without making emotional mistakes.
Armed with these insights, this approach has shaped my own strategy, enabling me to trade effectively, spend time with my young family, and run a business.
Make no mistake, trading isn’t easy. No strategy works all the time.
But by using ‘The Rule of One’ – one trade, one market, one pattern, one per cent or less risk – you will improve your performance, build confidence and move closer to your trading goals.
Till next time, best wishes.
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