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Step 5 of 7 4 min

How much to put in

Professionals don't ask “how much can I win?” but “how much do I lose if I'm wrong?”. A common rule: never risk more than 1–2 % of your money on one trade.

Example: with $10,000 and a stop-loss 5 % below your entry, risking 1 % ($100) means a position of $2,000 — not $10,000.

You don't need to be right often. If your losses are small and your gains are two or three times bigger, you can be wrong most of the time and still come out ahead.

Check what you’ve learned

1. You have $10,000 and want to risk 1 %. Your stop-loss is 10 % below your entry. What position size?
2. Can you be profitable while losing 6 trades out of 10?