What's the first thing you'd teach a friend about risk?
Imagine a friend opens a live account tomorrow. You get one lesson to give them before they place a trade. What is it?
Post:
- the lesson, in one or two sentences
- why it comes first
- the mistake it prevents
The position sizing guide is most members' answer in guide form — and the thread's answers reveal the rest.
Background: Position sizing: how to risk a fixed percentage per trade
How much you trade matters more than where you enter. A step-by-step method for sizing positions from your stop-loss and the amount you are willing to lose.
How do I calculate lot size from risk?
Divide the amount you are willing to lose by the stop distance in pips multiplied by the pip value per lot. For $50 risk, a 25-pip stop and $10 per pip per lot, that is 0.20 lots.
What is the 1% rule in trading?
A guideline to risk no more than 1% of the account on any single trade, so a losing streak doesn't cause a drawdown you can't recover from. It is a starting point, not a guarantee.
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