This maybe a beginner question

Hi im still learning about forex but how can I create a 10% stop loss? Like for example for a £100 account how do I do that?
thanks for your time ! :smile:

Its usually very simple to see and do once you have a platform open. I’m thinking most of them will display the £ risked between entry ans stop-loss as you adjust the stop-loss price up or down.

My experience is in spreadbetting but the principle’s the same. Suppose you want to enter the trade long at a price of 7500, and the chart shows a good place to put a stop would be just below a recent support level, let’s say its at 7463. You divide £10 by the difference in points, 37, and this gives you the position size, in this case 27 pence per point, maximum (you should also allow for spreads when you do this in practice).

BUT - bear in mind that with a £100 account and a risk of £10 per trade, that’s a 10% capital risk, which most traders will advise you is a very high level of risk, no matter that the amount in £ is small. Its easy to get a string of losers and if each is 10%, it would only take one series like that to get you to such a low amount remaining that you effectively can’t trade the account any more unless you top it up.

My advice is use a demo account to understand the mechanics of this process until you can do it in your head while blindfold and drinking a glass of water while walking along a tightrope.

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10% stop loss for £100 is 10£. But for risk management 10% is too high. For newbie trader 1% to 2% is the best. Even pro trader do not risk 10% of their capital. Before going for live trade, do some research on risk management and trading psychology.

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You are correct, @FerdousAzam.

@Uzzer123, you may find this article helpful in understanding the rationale behind risking only 1% per trade: The Most Important Math in Trading | New Trader U

According to you trading balance I think risk percentage is not appropriate and you have to minimize it for avoiding unfortunate losses.

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