Guidelines for adjusting lot size

[maya95]

Are there any strategies or guidelines for adjusting lot sizes based on account size and risk tolerance?

[RosiePalmar]

I use micro accounts and always keep my leverage or lot size small because I don’t want to put my capital at stake.

[ProfesorPips]

yes, visit these lessons Undergraduate - Senior - School of Pipsology - BabyPips.com

[ria_rose]

Helloooo! If you’re referring to planning your lot size even before you open the trade, this lesson might help.

Know What Your Position Size Will Be

[Amy95]

@maya95

Are there any strategies or guidelines for adjusting lot sizes based on account size and risk tolerance?

Maybe it is not professional but before you try out a new strategy or change your lot sizes, it’s a good idea to test them in a demo account first . This is what I do.

[maya95]

Are there any strategies or guidelines for adjusting lot sizes based on account size and risk tolerance?

[averied]

This question just makes no sense.

The risk you can take per trade depends on the win rate and RR ratio of your strategy.

This being said, it’s generally accepted not to risk more than 2% of your account per trade, and Also have a Daily límit.

[KaziTanzib]

Adjusting lot size is a personal decision based on your risk tolerance and trading strategy. It’s crucial to have a clear understanding of your risk management principles and to consistently follow them to protect your trading capital and achieve long-term success in trading.

[maya95]

My own leverage and promotions are also on a low level.thanks for your advice

[maya95]

Thanks professor. I should spend much time on school of pipsology it is a great source.

[maya95]

@Jckbt

Hi maya95,

Use this simple formula. It can get more complicated but this is a good starting point for you. The key is to convert pips into money.

USD/EUR: Risk(%of float) divided by ((0.0001x100,000) x stop size) = lot size
eg: You have a $10,000 float and want to risk $200 = 2% and have a stop of 50 pips.
$200 / ((0.0001x100,000) x 50pip stop) = 0.4 lot size
Check Formula = 0.4 lots ($4 per pip) x 50 pips = $200

Regards

hey Jckbt.
Thanks for the formula you mentioned just a question I should use it to calculate lot size??

[maya95]

Thanks Ria.
I really appreciate your time.
did you study the school of pipsology?

[maya95]

Hey Amy.
why you think it is not professional?
coz as far as I know all test their strategies on demo before.

[maya95]

why do you think so?
i was just trying to understand how to determine the appropriate lot size for trades and managing the risks

[maya95]

I guess every strategies that traders use is personal and it is based on their earlier experience and their knowledge.I asked this for understanding of how to determine the appropriate lot size for trades

[waltoncharles]

@Jckbt

Hi maya95,

Use this simple formula. It can get more complicated but this is a good starting point for you. The key is to convert pips into money.

USD/EUR: Risk(%of float) divided by ((0.0001x100,000) x stop size) = lot size
eg: You have a $10,000 float and want to risk $200 = 2% and have a stop of 50 pips.
$200 / ((0.0001x100,000) x 50pip stop) = 0.4 lot size
Check Formula = 0.4 lots ($4 per pip) x 50 pips = $200

Thanks for sharing the formula and I think it will come in handy for me.

[maya95]

Thanks @Jckbt
I applied it in some of my trades trying to learn it more still.

[MithcelRobert]

@Jckbt

Use this simple formula. It can get more complicated but this is a good starting point for you. The key is to convert pips into money.

USD/EUR: Risk(%of float) divided by ((0.0001x100,000) x stop size) = lot size
eg: You have a $10,000 float and want to risk $200 = 2% and have a stop of 50 pips.
$200 / ((0.0001x100,000) x 50pip stop) = 0.4 lot size
Check Formula = 0.4 lots ($4 per pip) x 50 pips = $200

Thanks for sharing in detail. I was at random in using lot sizes in my trading.

[igillman]

My broker (Oanda) shows me how much I am risking based on SL and lot size. As I adjust the lot size the risk value changes in real time so I am able to use it to make sure that I do not risk more than 1% or so per trade.

[AlexFromMelbourne]

I decide on stop loss based on trading conditions and then set the lot size from my risk percentage of my account balance, typically 1%. So for a 10,000 account the risk is limited to $100 per trade. I often use exit strategies that close a losing trade before hitting the stop level. There are calculators around for most trading platforms to help with risk calculations. I wrote my own in my testing and trading EA.