Trade of the week: up +20.35% in 2025 (+25% average over past 3 years, +19% average over 7 years)

(Partial video transcript)

2025 year-end trading review

Axel Rudolph: Hello and welcome to the last "Trade of the week" of 2025. And what I will do this week is not to come up with a trade idea, because it's a good time of the year to just take things easy, stop trading, think about what you've done during the year and try to improve things for next year. So let's look at our stats.

As you know, if you watched last week's "Trade of the week", we made over 20% by risking 2% of capital per trade. And I'll explain to you what that actually means in a minute. But if you look at the graphs in the video, you can see that over the last seven years, "Trade of the week" on average has made a return of plus 19%, risking just 2% of capital per trade. So you can consistently make really good returns. You can see on the charts that the last three years since 2023 is down to mainly me, up about 25%. And as I said, we were up 20% this year.

So let's just look at the numbers. You can see what we do is, for every "Trade of the week", we write down all of these trades. So we put the date down, and you should have a trading plan as well and write things down, because that way you can analyse what you've actually done, where you went right, where you went wrong, and so forth. So you have your date, then the direction of your trade. Is it long? Are you buying? Is it short? Are you selling? And then the asset, in this case it was Tesla in January, or in February for example, EUR/USD.

Tesla trade analysis example

Let's just go back to the Tesla one. You pick your entry level, and then straightaway you decide where your stop-loss is - your exit in case of things going wrong. Because this distance will determine your trading size. Why? Because if you have £10,000.00 available to you - that's our fictitious account - we will risk 2% of that. 2% of £10,000.00 is £200.00. If you then add the spread, here we added 0.01% for the spread. That means you can lose £201.00, which we did lose on Tesla. We got this trade wrong. But what I'm basically doing is I'm taking the distance, the stop-loss distance, divide it by my risk - my £200.00 - and that gives me my trading size. In this case, I could have traded £0.05 per point on the Tesla spread bet.

EUR/USD trade analysis example

Let's now take a look at the case of EUR/USD. You can see on the chart that the risk is 151 ticks between the entry level on the Daily Financial Bet at 10,326, and the stop-loss level at 10,175. So I'm taking not £200.00 this time around, but what I'm actually doing is I'm taking 2% of wherever my capital is. And you can see, at the beginning of the year I had four losing trades in a row. And now the deposit basically that we have, the money available, is down to £9,377.00. So I'm taking 2% of this sum. And what I basically do then is take this sum, divide it by 151. And that gives me the risk I can take per point.

So here for a EUR/USD, where I wanted to go long, I could have risked £1.24 on this trade. So you can see how you determine your trading size by your risk, and your risk is always 2% of whatever capital you have available to you. And what you then also look at is your reward-to-risk ratio. You want this number to be positive, and you will see here most of the time it is positive.

Trading examples outcome anlysis

So what I'm saying here, for example for Tesla, had I been right, I would have made 1.88 times more than when I was wrong. Or for EUR/USD, I would have made 2.81 times more than if I'm wrong. And basically, this is what makes you a profitable trade, because as you can see on the chart, every time we are wrong - as indicated by the red ones - we lose £200.00 or so. Obviously when the trading becomes bigger, when this size here we had £13,000.00 available. Our 2% risk was then £267.00 or £261.00. So it was bigger because we had a bigger amount of capital available to us. But you can see that on the right hand side here. The profits are bigger than the losses. £767.00 profit, £500.00, £600.00 and so forth. And this is what it is all about.

So when you actually look at the graph of the P&L, you can see that the winners are greater than the losers. And the losers are always more or less the same amount. So we're keeping our losses small, and we are letting our profits run. And this is how you can consistently make money, even if you’re only right half of the time or, in my case, for the last year, 2025, 46% of the time.

So I was wrong more often than right. But we made bigger average profits than we had average losses. And this is what investing and trading is all about.

Thanks for watching Trade of the week, and I hope to see you again for another profitable year in 2026.