Whilst i fully understand the reason for limiting % risk for new forex traders, what of those who have a solid (well, as solid as it gets) trade system(s) that have been in use for a while and is to a degree, predicable. When you can reasonably estimate the average % of trades as drawdown, the average % in profit ( per week/month) do seasoned traders increase their % risk from the recommended 1-2% of capital. Is this considered wise Money Management?
The answer to your question is to backtest it out and see what happens when you use larger risk percentages. The 1-2% thing is not a hard and fast rule, though some might lead you to believe that. Your position sizing should be a function of your system and your risk tolerance.
cool, thanks Rhody