Risk Management

Trading Discussion Risk Management Practices
1

Guys hope trading is going on well. I have this problem of not fixing mt stop loss in all my trades but am a profitable trader though and sometimes i get drawdowns but recover again in profits on the same trade. So i dont know if thats a bad idea??
Thoughts and comments are welcomed

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2

If you want to manage risk exposure, you’ll need to use a S/L for every trade. Just because you have recovered on some trades it is not risk management. My pro friend uses a very wide P/L to cater for retracements, but IMO losing trades should not be left running longer than your winning ones.

Having said that, if what you are doing works for you, just keep a close eye on what is happening in the market.

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3

yh sure thanks .

4

Hmmm. :thinking: It might also be a good idea to have a definite risk percentage you can manage. :open_mouth: This can guide you in placing your stop losses, and even the size of your position. :thinking: If you don’t mind, in the past, what has been your basis in placing your stop losses? :blush:

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5

well i used to place my stop loss with the assistance of fibonacci retracements and pivot points. But i used 10% risk

6

Any idea how wide in relation to his TP level or what the market is showing him? I guessing there’s a formula he’s using.

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7

To be honest, I have no idea how he he uses his Ebots, but there is a maximum S/L limit of 1% of capital per trade.

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8

What is the best way, according to you, to manage risk?

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9
  • Always set a stop-loss.
  • Make sure that if the stop is hit, the loss will be a small percentage of your account capital.
  • Use TA to identify the stop-loss level but make sure it is not so tight that ordinary volatility hits the stop.
  • If trading on short time-frames, allow for the spread touching your stop: make sure you allow for a widened spread at certain times of day.
  • Consider staying out or exiting a position before scheduled major news.
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10

Well I risk 2 to 5 percent of my account on a trade. Profit to loss ratio at 10:2

11

Have you tried to calculate your long-term win rate? Did raising R/R helped to improve your trading or you started from this setting initially?

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12

yeah, I’ve for the past months calculated my long-term win rate and its mostly 7:1 ratio but initially I started with 4:1. Well its helping and am still improving.