Why risk matters
Trading involves uncertainty, and even a well-researched idea can result in a loss. A risk plan helps define the amount of capital you are prepared to put at risk.
Position sizing
Consider the relationship between account size, potential loss and the distance to an exit point. Avoid taking positions larger than you can afford to lose.
A repeatable process
Write down your reasons for a trade, your risk limits and what would invalidate the idea. Review outcomes without assuming past performance predicts the future.
Markets involve risk. Nothing here is a recommendation to buy, sell or hold any financial instrument.
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