Risk Per Trade: How 1% Can Save Your Account
Risking 1% per trade is the gold standard. Learn why this number works and how to calculate it properly. Choose 0.5% or 1% with the math — and stick to it.
Why 1%?
Risking 1% of your account per trade means you'd need 100 consecutive losses to blow your account. Statistically, even a terrible strategy won't lose 20 in a row. At 1% risk, a 10-trade losing streak costs you 10% — painful but recoverable. At 5% risk, the same streak costs 50% — potentially account-ending.
How to Calculate 1%
Risk amount = account × 1%. For a $10,000 account: risk = $100 per trade. Position size = risk amount / (stop distance in price × pip value). Example: EUR/USD, stop is 20 pips, pip value $1 per standard lot. Position size = $100 / (20 × $1) = 5 mini lots (0.5 standard lots).
Adjusting for Conditions
- Reduce to 0.5% during high volatility or around news events
- Increase to 1.5-2% only after consistent profitability for 100+ trades
- After a drawdown of 10%, reduce risk to 0.5% until you recover
- Never increase risk to 'make back' losses — this is gambling, not trading
Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70-80% of retail investor accounts lose money when trading CFDs. Backtesting does not guarantee future results. Always consider whether you can afford the potential loss of your capital.