There is a tool that every trader use to control the damage you can accept in a trade. It is called stop loss order. It is an automated order that the trader enters following a newly opened position. This preset order tells the broker's computer when to get out of the trade. You may usually enter this value as points in percent (pip) or as dollar value.

Now the question that most traders face is, where to put the stop loss. No one wants to place an order too close to the actual trading price and get out of the trade in a small fluctuation. At the other end, we don't want to loose too much money at any trade.

The answer to that question is highly personal in my opinion. It depends on your account size, your appetite for the risk, how crazy you are, etc. But there is also some commonly accepted  ways of defining risk levels.

Most of the traders go for a fix percentage of their account as an acceptable loss. So if you have 10.000 $ in your account and you never want to loose more than 5% in a given trade, your maximum loss should be 500$. Now that is the step one.

The biggest mistake of beginner traders is to get this as a fixed position for a lot. So if you are trading one standard lot, this would be approximately 50 pips. This may be a large, or not enough range depending of market conditions. Let's take a look at the chart below.

It is the 1h chart at the time I am writing this article. The market is extremely volitile these days and you can see the pair has moved between 196.800 and 194.400 during the day (which is a 240 pips range).  If we decide to get in a trade now, 50 pips stop loss will be hit very easily.

Let's go to 4h chart and see the support levels for a long trade (buy trade).

First support level below the actual position is around 193.300, about 150 pips below.  It is likely that the pair may test this value one more time before going higher. So if we get in this trade right now, we should be ready to tolerate this back move until the support is broken.

So our 50 pips is not enough. We still want to keep our percentage fixed. We, then, should reduce the trade size. Instead of 1 standard lot, we should trade with 1/3 lot.

The problem at this point is that not every broker accepts less than 1 lot trades. If you do not have an account to tolerate 150 pips within the percentage you have already defined, you should not enter in the trade. Doesn't matter how good the trade is, how much money you can make, how likely that the pair will move in the direction you want. You don't have enough money to get in that trade.

First rule I have learned in forex trading is to be able to let it go. It happens often that the market is to volatile so that the risk is not acceptable for my account size. Yes these are the times you can make a lot more money than you can usually make. But remember, these are the times that you can loose a lot more money than you usually loose.

I hope it helps to my fellow new traders. Let me know if there is anything you want to see in my future articles.

• The customer or client that attempts to sue you for one reason or another.
• Bad publicity surrounding an event, which can cause repercussions to your business.
• Health and safety issues.
• Manufacturing variances that reduce the quality of your product.
• Criminal activities that affect your business.

Some examples of Unpreventable events include:

• The death or disability of key members of your company
• Natural disasters (floods, fires, weather)
• Economic events (inflation, competition, taxation)
• Social events (public opinion, changes in consumer practices)

You can't prevent a customer from suing you, but you can prevent the possible effect on your business by purchasing insurance. Health and safety issues can be dealt with before someone is hurt or injured. Installing a security system or hiring guards can prevent criminal activities. Manufacturing variances can be dealt with proactively rather than reactively.

While death and disability can't always be preventable, the impact on your business can be dealt with through advance planning. If you are a sole proprietor, is your life and health insured? Do you have disability insurance? Are you a partnership with the partners relying on each other for the success of the business? Insurance is the answer. Again, insurance can help you get back on your feet after a flood or fire. Economic events are dealt with through advanced planning. What will you do if your top product becomes obsolete? What will you do to minimize the affect of negative publicity?

There are two key elements to risk management. Insurance and Advanced Planning.
For new businesses, insurance may seem like a high expenditure, but it is absolutely vital to the success of your business. You don't want to see all of your hard work disappear because your business burned down, or watch your profits walk away after losing a lawsuit.

Plan for contingencies, document those plans, and put them into use. Review this document frequently to add new contingencies that you hadn't thought of earlier and to make sure they are still relevant.

For manufacturing, utilize Quality Management instead of Quality Control. Quality Management looks at what kind of variances are acceptable, and takes action to keep those variances in line. Quality Control simply responds after the variances have exceeded acceptable levels.

The key to Risk Management is acknowledging what risks you can control or minimizing their impact, determining how you will respond to those risks, putting a plan together and implementing it, and keeping those plans up to date.

Have you ever thought about how hard is to make money like the capitalists do? Read on.

First you need some money to start. Raising some money is the hardest part of the job. You can sell things you don't want anymore like old stuff you keep in your garage and even your old car. In sum you can raise about $10000 this way.

Staring a passive income business is another good solution to keep the money flow. Adsense website are very good to set and forget. Make some quickly.

Where will you invest your money? Another tough job. If you know the investment business and you are willing to take big risks there is not better way than doing it your self. However if you are cautious I recommend you to give your money to an expert or a company that will do this for you!

Risk Management. In business you will waste time, you will waste money, you will fail 99% of the times like Einstein and Edison admitted but don't let this drag you down! Instead let this be the greatest motivator to fight for your money like never before. Knowing that you will lose some in your way to success will make you a better warrior.

In investment I recommend you never to lose more than you can afford. Get your money as soon as you can if you things are getting ugly! Don't risk loosing it all! It's better to lose some and get the rest than to get no money at all!

A strategy is something you need to have in your way to success. Nobody can succeed without a map! You don't know what will happen tomorrow. You don't know every single corner of your business. How can you travel to somewhere you don't know and without a map? The "map" will never be 100% accurate but it's better than nothing!

Good luck in your journey!

The idea around value chain as expound in Porter's book involves “primary activities” that are deemed as value-adding activities of an organization which include the following: inbound logistics, production, outbound logistics, sales and marketing, maintenance.

Behind the “primary activities” are what you “support activities” that also add value to the organization. These functions are: administrative infrastructure management, human resources management, R&D, and procurement. The ultimate aim of value chain is to create maximum value at minimal costs (Wikipedia, 2005).

Value chain became a recognized management's powerful analysis tool for strategic planning. Kotelnikov (2001) defined value chain as a high-level model of how businesses receive raw materials as input, add value to the raw materials through various processes, and sell finished products to customers.

Value chain is critical tool to business development because it espoused the idea that, according to Kotelnikov (2001) “success in digital economy is the implementation of an integrated value chain that extends across - and beyond - the enterprise.” Hence, multiple value chain participants- from employees to managers to suppliers and to customers- must deliver value and strive for a common goal. Value chain then helps in

promoting understanding end-to-end process, spot anomalies, eliminates redundancy and inefficiencies allowing process design, transformation and experience take place freely and continuously (Kotelnikov, 2001).

Knowing what value chain can do, it is imperative then that Nokia, being a world leader in mobile communications, should implement value chain as a part and an important tool in its corporate strategy. Nokia aims to drive growth and sustainability of the broader mobility industry. It strives to connect people through innovative and user-friendly mobile phones, devices and solutions for imaging, games, media and businesses.

Nokia has products ranging from equipment, solutions and services that also cater to network operators and corporations (Nokia, 2005).

Patterns and trends in a constantly-evolving product such as mobile phones are very important to Nokia. Being ahead of its competitors and abreast with the changing needs of its customers is what keeps Nokia at the forefront of the mobile industry. Changes in the international business scene might influence the Nokia's value chain over the next five years or so. This is so because adapting to change and making necessary allocations for it is critical for Nokia's, or any company for that matter, survival.

Also, value chain is not contained within the individual's business alone. It also pertains to the supply chains and distribution networks. Delivering a combination of products and services to the end customer will create different economic actors along the way that have its own value chain. The synchronized interactions of those local value

chains lead to an extended value chain that could sometimes be global in extent (Wikipedia, 2005).

Changes that might affect Nokia's value chain could include the following:

Ever-Growing Need for Application Differentiation

U.S. mobile operators currently offer a number of premium mobile applications, accessed through handheld devices which are from various sources, qualified or certified, then offered access to the applications through a single interface for ease of use. To get a niche of the market, mobile operators must provide application differentiation because the same applications are available to other operators as well. To do this, increased investment in research and development for premium mobile data applications that aids in increasing non-voice data revenues is likely to aid mobile operators in dominating the expanding market (Frost and Sullivan, 2005).

Properly Targeted Applications Suite to Increase Operators' Data Revenues

Total penetration of mobile services in the United States has reached 65 percent which makes it difficult to secure potential of new subscriber. Mobile operators then turn to the existing subscriber base for revenue maximization opportunities such as providing premium data services. Since the focus of premium data services adds personal productivity and informational services to entertainment, mobile subscribers are expected to become increasingly dependent on these offerings. Proactive mobile operators that

address the changing needs of subscribers are believed to gain the most from this evolution (Frost and Sullivan, 2005).

Introduction of Next-generation Mobile Data Services

Innovation is a necessity in the mobile industry's growth. It is important then to differentiate and add value to products and services at the same time maintain end-to-end interoperability. Continued innovation in services and products such as additional mobile features, new applications and handsets is required for Nokia's growth in the mobile industry.

The shift towards next-generation technologies is evident in all sectors of the market. Both device manufacturers and subscribers are expected to gain from the implementation of these nascent technologies and applications in devices, which will in turn drive the expansion of the market (Frost and Sullivan, 2005).

Changes in Process Management

In a company, it is not possible to oversee all processes. Managers can only manage a narrow segment of a process. It is not possible to impose process design and make it work without assistance. This is why it is important for Nokia management to support and empower employees from the rank-and-file to the top of the echelon to deliver process work or a high level of performance focused on customers. Having an excellent business process in place provides greater clarity on strategic direction and cascade it through your organization (Kotelnikov, 2001).

Risk Management

As the business grows so do the risks involved. Nokia must anticipate and address these risks effectively. Risk management is one aspect that enables Nokia to accomplish this. Nokia as an international company encounters a number of risks in its operations such as engagement with governments and authorities to avoid legislation that is counter-productive for society or anti-competitive; supply-chain management to reduce risks to quality or productivity; management of conflicts of interest for employee satisfaction and to protect the brand (Nokia, 2005). Coming up with solutions on how to address these possible risks is one way of achieving value chain for the business.

Boosting Service-Profit Chain

This refers to the people in the chain, meaning, both employees and customers. It is important for powerful companies such as Nokia to keep in mind that creating a harmonious link between the two - employees and customers - is important influence in company's performance and boost profits (Kotelnikov, 2001).

Changes in Waste Reduction Methods

In most production operations, only a small part of the total time and effort actually add value to the end customer. Clearly defining "value" for a specific product or service using the end customer's perspective, all the non-value activities - or waste - can be targeted for removal step by step (Kotelnikov, 2005).

According to Kaizen, the Japanese strategy of continuous improvement, the main seven wastes are:

• overproduction,
• transportation,
• motion,
• waiting,
• processing,
• inventory, and
• defects

The future of the logistical operations of NOKIA such as procurement, distribution, maintenance and replacement of material and personnel is influenced by the changes cited above.

Future logistical operations of Nokia will have to make room for the necessary changes.

Raw materials procurement, for instance, requires sourcing of the latest materials needed for its plan to achieve differentiation. Also, wastes in transforming these raw materials to finished products should be monitored and if possible, completely eliminated.

Customer service of Nokia must focus on the key elements which are personnel and end-customers. Nokia must improve relations with both to achieve greater competence.

Billing service is one aspect of customer service they need to attend to. With new and faster technologies in place, customer billing will be greatly facilitated.

Distribution of new products might follow a different pattern. The difference could take the form of new set of target market or coming up with new promos and advertisements to attract existing users.

Maintenance of equipments could also be another aspect to look into. As the products evolve, the need for new and better equipment also follows. Replacement of material and personnel could be another matter to consider. New materials must be added or replace the old parts. Just as new personnel would be required to implement the latest changes at the same produce a better version of the old Nokia product. Learning better risk management could make the transition effortless for the giant company, Nokia.

Nokia as a business should evolve with the times. Nokia must learn to look into the different aspects of its value chain that could be improved and make necessary changes. Improving its value chain could spell the difference of profit or loss. And its results is often reflected in the income statement and balance sheet.

After all the survival of Nokia in a very fast-paced environment such as mobile industry could depend on its ability to look “after the markets they operate in, to anticipate risks, demonstrate company values, work at increasing employee satisfaction, enhance corporate governance principles, protect the Nokia brand and build a reputation for citizenship” (Nokia, 2005).