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What should be the risk percentage?

Michihito
Jan 12 2021 at 12:41
posts 298
Actually risk percentage depends on many factors. How much you can tolerate is a factor. It also associated with your winning ratio. A trading strategy is a combination of all factors according to your skills, capital, risk tolerance power. You have to make a system so that you can survive in the market and make profit.
Seb King (sebking1986)
Jan 12 2021 at 14:24
posts 399
Agreed but that being said a rule of thumb for beginners is 1-2% regardless of RR per trade. How many trades are placed at once is another question. Personally no more than 3 at a time
If you can't spot the liquidity then you are the liquidity.
AliaDare
Jan 12 2021 at 14:31
posts 788
I don't think you should risk more than 2% for a trade. If you risk more than 2%, it will never be under the management of money management.
Dictiony
Jan 13 2021 at 02:07
posts 231
AliaDare posted:
I don't think you should risk more than 2% for a trade. If you risk more than 2%, it will never be under the management of money management.
Yes, exactly the advice which I was also thinking of. We should not adopt the risk over 2% to keep our trade safe.
richard2
Jan 13 2021 at 07:16
posts 38
It actually depends on a trader's risk tolerance, Different with everyone. Hard to standardize.
tiahsherman
Jan 21 2021 at 11:35
posts 15
I agree with you. I never risk more than 1-2% to be on the safer side in my trades.
CraigMcG2020
Jan 21 2021 at 14:57
posts 328
LeonRocky3
Jan 21 2021 at 19:43
posts 29
Personally I give myself 2% risk
MichaelEX
Jan 28 2021 at 09:44
posts 48
The risk-reward ratio measures how much your potential profit is, for every dollar you risk.
If you have a risk-reward ratio of 1:3, it means you’re risking $1 to make $3.
downtown
Jan 29 2021 at 07:35
posts 26
Either 2% or 1:2 risk ratio are fine
LyudmilLukanov
Jan 29 2021 at 09:08
posts 796
Traders should not take more than 5% risk per trade. That’s why traders can survive in the market long.
gildlef
Feb 04 2021 at 09:59
posts 27
It is wise to not risk more than 2% of your trade. This will be safe and you won’t end up losing a lot.
phillipgriffin
Feb 09 2021 at 08:17
posts 33
downtown posted:
Either 2% or 1:2 risk ratio are fine
Is there any strategy or any method to set the risk reward ratio for a day trader like me?
phillipgriffin
Feb 09 2021 at 11:22
posts 33
phillipgriffin posted:
downtown posted:
Either 2% or 1:2 risk ratio are fine
Is there any strategy or any method to set the risk reward ratio for a day trader like me?
Call it a strategy or not, there’s actually a simple formula that asks you to compare the amount you’re willing to risk on the trade to the prospective gain. Statistically speaking, if you’re planning to have a prospective profit of $600 as compared to a projected risk of $200, the risk reward ratio in this case would be 1:3. So, now if you place say 10 trades with a ratio of 1:3 and only made profit in 3, you would still make $400. A decent amount of profit despite being correct only 30% of the time.
The 1% rule can give you the leverage to withstand a long string of losses. However, before you plan on risking even 1% of your money, I’d suggest you to practice on the demo account. I did the same with my brokers Fxview and IB to have a better understanding of how the market works.
phillipgriffin
Feb 10 2021 at 07:03
posts 33
phillipgriffin posted:
phillipgriffin posted:
downtown posted:
Either 2% or 1:2 risk ratio are fine
Is there any strategy or any method to set the risk reward ratio for a day trader like me?
Call it a strategy or not, there’s actually a simple formula that asks you to compare the amount you’re willing to risk on the trade to the prospective gain. Statistically speaking, if you’re planning to have a prospective profit of $600 as compared to a projected risk of $200, the risk reward ratio in this case would be 1:3. So, now if you place say 10 trades with a ratio of 1:3 and only made profit in 3, you would still make $400. A decent amount of profit despite being correct only 30% of the time.
The 1% rule can give you the leverage to withstand a long string of losses. However, before you plan on risking even 1% of your money, I’d suggest you to practice on the demo account. I did the same with my brokers Fxview and IB to have a better understanding of how the market works.
Ok, so I do understand that the 1% rule is for the beginners, rather it’s the most critical rule they need to set and follow. But what if I’ve spent years trading? Do I still need to follow this risk reward ratio?
salamibrish
Feb 10 2021 at 09:52
posts 28
phillipgriffin posted:
phillipgriffin posted:
phillipgriffin posted:
downtown posted:
Either 2% or 1:2 risk ratio are fine
Is there any strategy or any method to set the risk reward ratio for a day trader like me?
Call it a strategy or not, there’s actually a simple formula that asks you to compare the amount you’re willing to risk on the trade to the prospective gain. Statistically speaking, if you’re planning to have a prospective profit of $600 as compared to a projected risk of $200, the risk reward ratio in this case would be 1:3. So, now if you place say 10 trades with a ratio of 1:3 and only made profit in 3, you would still make $400. A decent amount of profit despite being correct only 30% of the time.
The 1% rule can give you the leverage to withstand a long string of losses. However, before you plan on risking even 1% of your money, I’d suggest you to practice on the demo account. I did the same with my brokers Fxview and IB to have a better understanding of how the market works.
Ok, so I do understand that the 1% rule is for the beginners, rather it’s the most critical rule they need to set and follow. But what if I’ve spent years trading? Do I still need to follow this risk reward ratio?
Well no, that entirely depends on your comfort as a trader to bear the loss. See, the 1% rule can be twisted depending on your account size and the market. You simply need to set a percentage that you’re comfortable playing and risking around with. Once done, all you have to do is calculate your trade’s position size depending on the entry price and stop loss.
forextrader777
Feb 12 2021 at 11:28
posts 128
Risk percentage depends upon your risk tolerance. Both are directly proportional to each other.
RobSchiz
Nov 07 2021 at 19:55
posts 567
forextrader777 posted:
Risk percentage depends upon your risk tolerance. Both are directly proportional to each other.
Yes. you are right.
GraceGilm
Nov 09 2021 at 14:32
posts 154
some traders generally only work with risk interest, because this and profit can greatly hang
Anayallador
Nov 09 2021 at 14:57
posts 26
Actually, every trader decides by himself, what risk percentage to set. The genral rules sound like never open a position with more than 2-3% from your total deposit. However, traders don't often comply with this rule. Every trader wants to get as much money as he can, so he decides to open a position with 10-20% or the whole amount of deposit. It's prohibited, in case you want to build long-lasting trading career. Nevertheless, there are some traders who can open position with a half or the full of the deposit, but they're professionals and often they know what to do.
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