Risk Per Trade
Risk per trade is the amount or percentage of trading capital a trader intends to lose if a trade reaches its predefined invalidation or stop level.
Why it matters to you
Thinking in terms of account risk prevents traders from focusing only on leverage or position size. For example, a trader may decide that a particular setup should risk $100. The position can then be sized around the distance between the entry and stop so that the intended loss is approximately $100 before allowing for fees, slippage and other execution effects.
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