Risk management

Are there any resources that focus on risk management? Hope you could share if you know of any.

  1. Never risk more than you are willing to lose
  2. ALWAYS use a stop loss
  3. Don’t risk more than 2% per trade
  4. Avoid trading anything less than a 1:1 RR
  5. Avoid trading during high volatility news announcements

All these I would have got from resources over the years but wouldn’t be able to pin point any one source sorry.

Just my 2 cents worth :slight_smile:


Thanks for this @TraderEvolved.

Are you looking for books or youtube videos? Which medium?

Any would do. I’m just looking for something that tackles risk management.

Right, Sir. I appreciate your answer.

Thank you

This is an interesting thread on risk/reward with hypothetical numbers.

Good list. I might add having something like a 3 strikes and out policy where you walk away for the day and come back the next to avoid chasing losses.

Risk management is one of the important skills that a trader must have to control losses in trade and never risk more than your loss percent.

Risk management is very important, is good to use calculator for calculate risk. I’ve read that the safe is effects are 1:2, but I’m not sure.

Risk management is one of the reliable skills that every trader can use to calculate the risk and profit percentage. It is also useful when trading with leverage to calculate the suitable ratio.

Everyone feels bad hearing the story of Loss. However, this is the reality that if you want to make money from any sector, you must accept the loss. However, it is possible to minimize the loss. And this is what successful traders use.

For example, if I enter the trade by doing technical analysis and maintaining 1: 2 risk, the percentage of loss will decrease and the share of profit will increase.

Any tips on how to take more risks haha
I am very risk-averse and it results in me not having the guts to do most of the stuff I would like to do and then I miss all the opportunities. I know about all the ‘pointers’ in theory but I just can’t get myself to take the risk.

Quite agree with you. Risk management as well as money management are the foundation of trading activity as itself. I guess that no matter how much strategies do you know, or how perfect is your technical/fundamental analysis, if you don’t know how to manage the risks, how to distribute your money wisely, then be ready for deposit dumping. I’m convinced that every novic must have to start with these two notions, afterwards learn technical/fundamental analysis and create his/her personal strategy. Everybody has to remember that there are no luck at trading at all, only skill and deep knowledge.

Sure, in addition to risk management we can also talk bout money management as well. It matters a lot in case a trader doesn’t want to lose all his deposit in first days of trading. Risk management helps traders wisely use their deposit and make conclusions on various matters, such as whether it’s wise to open a position on the particular asset/currency pair or it would be better to wait for a little bit until the high volatility disappear, while money management lets traders to think of how much money do they afford for a particular position. Of course there are some other vital things in trading, but to my mind these two are the most signficant.

Here are some tips you could put to good use for risk management:

  1. Never risk too much, better establish how much you are willing / able to lose
  2. Choose the right position size
  3. Use a stop loss
  4. Set a percentage risk pre trade ex. up to 2% per trade
  5. Control emotions
  6. Avoid trading highly volatile pairs
  7. Keeping a trading journal can help
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