| Calculating Position Sizes (lots) | |||||
|
1. |
Account size | $ 1.000,00 | How much money you have to trade | ||
|
2. |
Risk Ratio, % |
2 % |
What percentage of your money you are willing to risk | ||
|
3. |
Stop-Loss, standard pips | 10 | What is the distance between the entry price and the stop loss for every trade | ||
| POSITION SIZE (lots) | 0,20 | Result: your position size | |||
|
1. |
Account size | ||||
| Balance: the money in your account | |||||
|
2. |
Determine your Risk | ||||
| Before you can select an appropriate lot size, you need to determine your risk in terms of percentages. Normally, it is suggested that traders use the 1% to 2.5%, maximum. | |||||
| This means in the event that a trade is closed out for a loss, no more that 1% to 2.5% of the total account balance should be at risk. | |||||
|
3. |
Stop Loss | ||||
| As with any open position, a stop should be set to determine where a trader wishes to exit a trade in the event the market moves against them. | |||||
