Negative 1/2 risk

Hi all, I’ve been trading for a few years and feel confident about my daily gains etc. I have recently decided to come up with a new strategy that has proven to have a high success rate. Upon becoming comfortable with it and having fully implemented it into my trading life I took the decision to have a wider S/L than T/P.

I have made just under 10% in 2 weeks but I’m not sure how I feel about the wide stop loss, it works but is it the best. If anyone would have any advice I’d appreciate it :money_mouth_face: :money_mouth_face:

Use the chart to tell you where your stop-loss should be, not your account balance. When you have more than one stop-loss options, choose the widest. Then reduce the size of your position so that your risk if the stop-loss is hit is 2% or less of your account capital.

1 Like

wow, I never thought of managing my risk this way. For the next few trades I will try this method and tell you how I get on. I’ve always given myself a fixed TP and SL but now your method does seem to have a lot of logic behind it. Thanks a lot @tommor

I support you. Without a stop loss, it is not possible to maintain the risk.

Just use the ATR NUMBER X 1.5 - 2, and adjust your S/L to no more than 2% of your capital. I’ve found that, in many instances, a trade will clearly be a winner or a loser well before a wide S/L is triggered. It’s better to then cut losing trades, and set up a trailing profit on winning trades.

Yes, you could get some trend reversals, but you’ll gain long term by cutting losses sooner, forgetting about them, while letting profits run. You can’t make money on losing trades.

1 Like

You just need to have a high accuracy. I scalp on the 5min and i have a wider SL. Its near impoossible when scalping short time frames going for 5-10pips to have an SL lower. Just keep your accuracy up and youll be fine

1 Like

I don’t scalp, my accuracy comes from my strategy and is very accurate when it comes to entries. The only issue I had is a fixed SL of 30 pips and I swing trade so minute time frames are irrelevant to me

Better to trade at 1: 2 risk-reward each time. This creates the ability to cover losses. And it is possible to succeed in trading if you can cover losses.

1 Like

It works just delaying one big devastating loss :). Which will come inevitably at some time. Ask yourself a question: will you be able to recover after one big serious loss. From my experience it is very challenging, because to relieve the pain of the loss you want to make up for it quickly => more mistakes => even more mistakes…

1 Like