How do you calculate best optimal MM risk % per trade?

[Aaron Dias]

The amount of income that we get from our trading in a day matters. If our income is not sufficient then we may not get success at all.

After all we may not be able to continue trading after getting repeated losses.

In my trading career i have blown my trading account many times. And this happen as i was not able to control my trades in a manner that i should have done.

 

[iMusingKiMi]

I will advise forget about those text book theories. It still depends on what is your strategy, size of your fund, have you ever thought in the worst case scenario of market. Some people will say 3% of risk per trade, but 15 losses trade of streaks do come. Does that mean you willing to risk 45% of your capital?

 

[Aaron Dias]

I will advise forget about those text book theories. It still depends on what is your strategy, size of your fund, have you ever thought in the worst case scenario of market. Some people will say 3% of risk per trade, but 15 losses trade of streaks do come. Does that mean you willing to risk 45% of your capital?

It is really a fact that i have risked more than 10% of the trading capital in my trades and i can say for sure that i made a big trading mistakes by doing that. I have learned my lessons after making a considerable loss in the Real trading accounts.

 

[iMusingKiMi]

It is really a fact that i have risked more than 10% of the trading capital in my trades and i can say for sure that i made a big trading mistakes by doing that. I have learned my lessons after making a considerable loss in the Real trading accounts.

No worries, human do have mistakes. As long as we learned from mistake, it is worth to pay for those mistake when we are trading in a small fund. Always put worst case scenario in your money and risk management. Even professional do have a long loss streaks, 15 is just one of example given and even some professional have more than that. Text book theories are just a guideline.

 

[Aaron Dias]

No worries, human do have mistakes. As long as we learned from mistake, it is worth to pay for those mistake when we are trading in a small fund. Always put worst case scenario in your money and risk management. Even professional do have a long loss streaks, 15 is just one of example given and even some professional have more than that. Text book theories are just a guideline.

After we have made such type of mistakes in our trades we do not have to worry and think about how we are going to increase our trading profits

 

[iMusingKiMi]

After we have made such type of mistakes in our trades we do not have to worry and think about how we are going to increase our trading profits

That's true. Learn when you are trading with small money. When you go to big money, you know what you shall do then.

 

[bigdolly]

Trading with small and big money is different. It's about game of probabilities and when you just increase the stake proportionally to your deposit you don't take such important points as emotions into considerations. It's easy to accept to lose 2% from 100 bucks (only 2 bucks) but it's not the same for 10K deposit when it goes to 200 bucks. So think carefully how much you tolerate to lose and how much to expect to earn because its a key for easy and efficient control of your psychology.

 

[iMusingKiMi]

Trading with small and big money is different. It's about game of probabilities and when you just increase the stake proportionally to your deposit you don't take such important points as emotions into considerations. It's easy to accept to lose 2% from 100 bucks (only 2 bucks) but it's not the same for 10K deposit when it goes to 200 bucks. So think carefully how much you tolerate to lose and how much to expect to earn because its a key for easy and efficient control of your psychology.

I absolutely agree on this. Therefore, I have seen a lot of trader that loves to use text book trading about money management. As I said for instance 3% for each trade, when it comes to a streaks of 10 losses, are you willing to lose 30% of your capital no matter in 10,000 account or 100 bucks account.

 

[Aaron Dias]

I absolutely agree on this. Therefore, I have seen a lot of trader that loves to use text book trading about money management. As I said for instance 3% for each trade, when it comes to a streaks of 10 losses, are you willing to lose 30% of your capital no matter in 10,000 account or 100 bucks account.

Yes it is a fact that unless we will learn how to manage our funds and what is best way to do our trading we may not get much success in this field

 

[downtrend]

I have a fix dollar amount that I risk on every trade of mine. I check the pips to my stop loss and then adjust my lot according to my risk.