How much of my account should I risk per trade?

The 1–2% rule

Most experienced traders risk 1–2% of their total account on a single trade. If your account is $10,000, risking 1% means you can lose a maximum of $100 on any one trade. This protects you from catastrophic losses even after a series of bad trades.

How to calculate position size

Decide your max loss (1% of account), your stop-loss distance in pips, and the pip value for your position size. Work backward: if your max loss is $100 and your stop is 10 pips away, and one pip equals $10 per standard lot, you can trade one standard lot. Many brokers offer calculators for this.

Why it matters

If you risk 5% per trade and take five consecutive losses, you've lost 25% of your account. Recovery requires significantly larger gains. Risking 1–2% means you can sustain 10+ losses and still have most of your capital. This discipline separates traders who survive market volatility from those who don't.