2024-12-19 07:21
IndustryCore Principles of Risk Management
1. Risk-Reward Ratio
Set a minimum ratio of reward to risk, typically 2:1 or higher.
Example: Risking $50 to potentially gain $100.
2. Position Sizing
Determine the size of each trade based on your account balance and risk tolerance.
Use a position size calculator to avoid over-leveraging.
3. Maximum Risk Per Trade
Limit risk to a small percentage of your account, typically 1-2% per trade.
Example: With a $10,000 account, risk no more than $200 on any single trade.
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Core Principles of Risk Management
Hong Kong | 2024-12-19 07:211. Risk-Reward Ratio
Set a minimum ratio of reward to risk, typically 2:1 or higher.
Example: Risking $50 to potentially gain $100.
2. Position Sizing
Determine the size of each trade based on your account balance and risk tolerance.
Use a position size calculator to avoid over-leveraging.
3. Maximum Risk Per Trade
Limit risk to a small percentage of your account, typically 1-2% per trade.
Example: With a $10,000 account, risk no more than $200 on any single trade.
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