Risk Management: Protect your Capital

[Sr.Necro369]

Risk management is essential. What can you tell me about the position size, stop loss and risk-reward ratio to protect the trading account and not end up burning it hahaha.

I'm sorry for having made several posts, it's because I have a lot of doubts.

 

[Fin_Trader]

First of all, you need to trade with a lot size that corresponds to your deposit size. Also, the lot size in a transaction is calculated from the stop loss size. Thus, we decide how much we can and how much we are willing to lose in case of an unsuccessful trade, rather than suffer a drawdown until we lose the entire deposit in the hope that the price will someday reverse)).