Risk Management

How much should you be risking per one trade?

In most textbooks and online education programs, you will learn that you should not be risking more than 2% per one trade.

Although the answer to this is more complicated, let’s start with saying that 2% risk per trade is a good base to start with.

However, if you decide to risk 10% per trade you would be down over 60%,
and that would be a deep hole to dig yourself out of.

Do you know how the Risk-Reward Ratio is correlated with the Win Rate?

From MyForexFunds’s proof-of-concept phase, research, and current live traders, the following points can help you in your funded account journey:

1. The best funded traders risk no more than 1% per trade and have a 1:1 or higher R:R
2. 3% of funded traders lose their money in the first month due to poor risk management (don’t be like them)
3. 99% of traders who trade highly leveraged crypto do not reach funded status due to volatility and high trade size
4. The traders who have remained funded in their second month without breaching the rules have no more than 3% daily drawdown on any given day (sometimes no trade is a good trade)
5. The most profitable traders in percentage return do not trade more than 5 trades on any given day.

Reference
- FTMO Risk Management in Trading
- MyForexFunds