Money management strategy

Your risk per a trade should never exceed 3% per trade. It's better to adjust your risk to 1% or 2%We prefer a risk of 1% but if you are confident in your trading system then you can lever your risk up to 3%1% risk of a 100,000$ account = 1,000$You should adjust your stop loss so that you never lose more than 1,000$ per a single trade.If you are a short term trader and you place your stop loss 50 pips below/above your entry point .50 pips = 1,000$1 pips = 20$The size of your trade should be adjusted so that you risk 20$/pip. With 20:1 leverage,your trade size will be 200,000$If the trade is stopped, you will lose 1,000$ which is 1% of your balance.This trade will require 10,000$ = 10% of your balance.If you are a long term trader and you place your stop loss 200 pips below/above your entry point.200 pips = 1,000$1 pip = 5$The size of your trade should be adjusted so that you risk 5$/pip. With 20:1 leverage, your trade size will be 50,000$If the trade is stopped, you will lose 1,000$ which is 1% of your balance.This trade will require 2,500$ = 2.5% of your balance.This's just an example. Your trading balance and leverage provided by your broker may differ from this formula. The most important is to stick to the 1% risk rule. Never risk too much in one trade. It's a fatal mistake when a trader lose 2 or 3 trades in a row, then he will be confident that his next trade will be winning and he may add more money to this trade. This's how you can blow up your account in a short time! A disciplined trader should never let his emotions and greed control his decisions.