Well we don’t as yet know your trading methods - If you are trading multiple concurrent lots - and your method requires 20% of your account to be tied up then you may have a point. I know @tommor has issues occasionally with “margins”
THe magic of compound interest ! 
Risk is variance of an instrument performance. The higher is leverage the easier is to knock you off with a swing if you use high leverage. Rising leverage has linear relationship with rising risk of blown up your account, that’s why we have confusion of the terms, while they do different.
I agree with you. And my experience along with that of some friends show. When I started my capital was usually small and my leverage high. And of course I blew the account several times as I was not able to practice the best risk management or risk 1% and make good money. But then I found [Removed for Forums policy violation], a prop fund and it really made a huge difference for me. I tried it at my last shot in Forex as I was really at the brink of giving up. They gave me 50,000 usd for a start with a leverage of 1:3 to trade with. I was skeptical at such a small leverage I wasn’t used to as a retail trader. But months later and I am better off and profitable. I am able to apply a conservative risk management and still profit.
there no set rules but especially for beginning its to protect blowing up accounts,even the most experienced traders will have bad weeks or maybe months ect,not only one bad trade can wipe out most of the account, winner s and losers often occur in clusters.Though i dont use the 2% rule
i??? can you explain please ?
Okay. I subscribed for a 50,000 GBP account with a leverage of 1:3. As a retail trader what I had been used to was 1:200 upwards because my capital was usually small. But for this amount of money (50,000 GBP) I had access to, I didn’t need such leverage with its negative consequences when the trade goes against you.
You don’t use the 2% rule? What do you use them to trade safely?
dont want to sound pretentious but go by hunch , i dont always have a great amount in my account at one time if i have a bad week i top up , im in profit for a while now since a bad spell when i first went live
we all react to loss differently so the 2 % rule is a good start and gives people a structure which is probably needed especially when starting
Okay. Should you ever need access to much more capital I would recommend you check out their offering. [Removed for Forums policy violation]
As for topping up, it depends on how much money you had, how much you lost and how much you can afford to put back.
I remember reading Market Wizards & read where a seasoned trader allocates 1% to all trades. It’s something some top traders still do to manage risk in billions.
im not really interested in Blufx ,Robin Hood ect ect the old cliche if anything sound s too good to be true it probably is but because im quite inquisitive i look it up. Im happy regarding my progress so thats all what matter s really.Everything relative isnt it, 1% of a billion pounds/dollars is a large sum of money
This is so interesting, I had never considered this when projecting my future returns using a compound calculator. Where can I read more about this so I can plan accordingly?
Yes, you clearly don’t understand the point of the advise “Only risk 1% - 2% of your capital on any single trade”. Your assertion that “from a mathematical perspective it’s simply not an optimal thing to do”, is pretty hilarious to a trader. Let me try to clear it up for you.
Your job as a trader is NOT to maximize profit, it is to MINIMIZE loss. You WILL lose. If you trade, you will have losers.
One (of many) rules of basic risk management is to only risk %1 of your capital on any single trade. In fact, a more experienced trader with a large account will only risk 1/2%!!! Not more!!!
Truth: Someone with a small account will sometimes risk up to 2% (max if they are smart) in an effort to accelerate the growth of their capital. Sadly, this will often just accelerate them blowing up their account.
Yes, in any given trade the more you risk, the more you will win IF it is a winner, but the more you will lose if it is a loser!!!
Let’s look at some math. If you start with $1,000.00, 1% is $10.00. My recommendation to you, a new inexperience trader would be paper trade for a full year, risk NOTHING. Then, once you have developed a trading plan that is profitable (one that will include rules such as risk no more than 1% on a trade), THEN and only then Live Trade. And risk ONLY $10 (even if you have a $100K account) using your back tested strategy and trading plan for 3-6 months!!! Now, at the end of that time if you are profitable, THEN start risking 1%!!!
Now from your post, I know there is no way you are going to take this advice and treat trading like a business, but back to 1% ($10) of your $1,000.00.
If you divide $1,000.00 by $10.00, you get 1000 / 10 = 100. In other words, you have up to 100 trades, even if you lose. Now lets say you decide instead to risk $500 on your first trade because you just KNOW it is going to be a winner. You lose. Now you have a 50% draw down, and have 1 $500 trade left in your pocket!!!
This is why. If you don’t understand this basic math, then I suggest you keep your day job, because you will be broke in no time, if you aren’t already.
Remember too, it’s not how much you win on any one trade, it’s how many winners vs. losers, and how much are you winning on trades vs. losing!
From the get go psychology will play a big part.
Right now your thinking like rational economic man but when money is on the line that goes out the window particularly when trading on margin.
There are statistical reasons why you should divi up your capital but also psychological ones
As was written in Reminiscences of a stock operator - always sell down to the sleep point.
in other words don’t trade to big.
With the margin even 2% can work out as lots of profit
Personally I use about 3.5
Okay. That’s fine. I’m glad you checked it out. Blufx isn’t too good to be true. You actually have some rules to follow. The leverage is also not up to you to choose. Too good to be true would be the money sent to you and you can do anything you want with it in the name of trading.
Well, I wish you well in your journey.
I find that this is difficult for most retail traders when they have bills to pay and their capital is small as is usually the case. So they start by using a very big leverage and the rest they say is history from that point. [Removed for Forums policy violation] Someday my dreams would come true using my profits.
i probably have a look for entertainment value
Oh that’s fine. Cheers mate
Smartest advice? “don’t over think it”