How much do you risk in a trade? | Forex Factory

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How much do you risk in a trade?

  • #1
  • First Post: Jan 30, 2012 12:27am Jan 30, 2012 12:27am
How much do you risk in a trade? I am referring to the percentage of your entire account size risked in a trade. Professionals typically recommend risking 2% to a max of 5% of one's account size. I don't mind revealing I actually risk a lot more than 5% at the moment, and I admit there are some downsides to risking that much.
'For the market to work, it needs people who think that they can beat it.'
  • #2
  • Jan 30, 2012 1:19am Jan 30, 2012 1:19am
more risky - more effectively! if you are lucky a bit and know what you do of course)
  • #3
  • Jan 30, 2012 1:39am Jan 30, 2012 1:39am
anywhere from 3-5% per trade.
  • #4
  • Jan 30, 2012 2:48am Jan 30, 2012 2:48am
As a full time day trader, I find anything more than 2% is suicide.

I personally trade 2% if the trade is with the trend, 1% if it is against the trend. I have stop sizes that allow the possibility of tightening that stop to less than the original 2% if it show signs of working.

I am pretty disappointed if I take a full 2% loss on a trade, if I have, it means I was completely and utterly wrong, which happens of course and so the medicine is taken.
You can quit and they won't care, but you will always know.
  • #5
  • Jan 30, 2012 3:43am Jan 30, 2012 3:43am
Quoting Akuma99
As a full time day trader, I find anything more than 2% is suicide.

I personally trade 2% if the trade is with the trend, 1% if it is against the trend. I have stop sizes that allow the possibility of tightening that stop to less than the original 2% if it show signs of working.

I am pretty disappointed if I take a full 2% loss on a trade, if I have, it means I was completely and utterly wrong, which happens of course and so the medicine is taken.
From my personal observation, trading with small size (percentage) gives less burden in terms of psychology and allows an account to survive longer in the case of bad days. That is the benefit I have noticed.

However I would reason that if you use only 2% of the money, why not put much of the rest of the unused money in safer investments rather than not using them as all.

Let's say your account is 100K. 2% would be $2000. Isn't it possible to take out like for example 50K to invest in lower risk instruments? It does make more sense to me this way in terms of maximizing profits.

Like I mentioned in the first paragragh, this might take a toll on psychology because of the percentage size and increase effect from the losses incurred on one's account. But if one is psychologically strong enough to handle this, it is actually workable. This without saying that the trader must be equipped with a very good system and possess excellent trading skills.
'For the market to work, it needs people who think that they can beat it.'
  • #6
  • Jan 30, 2012 4:03am Jan 30, 2012 4:03am
2% is what I am willing to lose, but you need substantially more than that to cover margin, especially at lower leverage limit account as I trade. Also I don't pretend to always win, so if I need some funds for new trades, I don't want to be transferring in and out to do that and pay fees. Not to mention limits brokers place on maximum transactions in a month for withdrawals.

My trading account is the money dedicated to that profession, it doesn't mean it is my entire net worth
You can quit and they won't care, but you will always know.
  • #7
  • Jan 30, 2012 9:32pm Jan 30, 2012 9:32pm
pretty difficult to express in words a percentage of risk that I have) of course it takes place in every trade but simultaneously it depends... so, depends on day, deal, mood, whatever)
  • #8
  • Feb 2, 2012 4:15am Feb 2, 2012 4:15am
Generally, I took 2% to 4% risk in a trade while it is not hard and fast rule for me. Sometimes I go for lower percent of risk during trading.
  • #9
  • Feb 2, 2012 1:08pm Feb 2, 2012 1:08pm
My lot size is based on 1.8% risk per trade;however my stop loss is around 1%.
With God all things are possible.
  • #10
  • Feb 2, 2012 1:13pm Feb 2, 2012 1:13pm
0.5% max
  • #11
  • Edited 2:49pm Feb 2, 2012 2:33pm | Edited 2:49pm
How much you risk per trade is very important, but second most important thing is Stop Loss based on you risk.
For example if I have 10K on my account I will risk 3% and this is 300$

If my SL is 50 pips I will trade with 0,6 lot and I will earn 300$ for every 50 pips of profit.

If my SL is 30 pips I will trade with 1 lot and I will earn 300$ for every 30 pips of profit.

If my SL is 10 pips I will trade with 3 lot and I will earn 300$ for every 10 pips of profit.

Yes you can have 10 pips for SL and you will earn 1500$ for 50 pips of profit, but before you will hit your profit, SL will be hit

Question is which SL survive most often?

Use attachment to calculate proper lot size based in SL
Attached File(s)
File Type: xls Money Management.xls   89 KB | 344 downloads
  • #12
  • Feb 2, 2012 2:35pm Feb 2, 2012 2:35pm
Quoting AlastorFate
How much do you risk in a trade?
1% or less. Never, ever more than that.
  • #13
  • Feb 2, 2012 3:52pm Feb 2, 2012 3:52pm
I risk 1% to - 2% of my account. I would rather earn less than expose my account more than 2%
  • #14
  • Last Post: Feb 2, 2012 4:41pm Feb 2, 2012 4:41pm
Quoting diggerpips
How much you risk per trade is very important, but second most important thing is Stop Loss based on you risk.
For example if I have 10K on my account I will risk 3% and this is 300$

If my SL is 50 pips I will trade with 0,6 lot and I will earn 300$ for every 50 pips of profit.

If my SL is 30 pips I will trade with 1 lot and I will earn 300$ for every 30 pips of profit.

If my SL is 10 pips I will trade with 3 lot and I will earn 300$ for every 10 pips of profit.

Yes you can have 10 pips for SL and you will earn 1500$ for 50 pips...
I think what you really mean there is to adjust the POSITION SIZE based on the Stop Loss distance, but you are on the right track as every trade will be a fixed % of account, keep up the good work.

Spreadsheet is worthless; takes no account of NON - USD based pairs???

Better to use this for sure ----->

Position Size Calculator

And my trade size is 2% of account to answer the OP question

It takes a lot for me to IGNORE you, but you can try.
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