The Golden Rule
Never risk more than 1% of your trading account on any single trade. If your account is $10,000, your maximum risk per trade is $100.
Why It Works
Even with a 50% win rate, a string of 10 consecutive losses only draws down your account by ~9.6%. Survivorship is the name of the game.
How to Calculate Position Size
Position Size = (Account Risk) / (Entry - Stop Loss). This formula ensures every trade carries equal risk regardless of the pair or timeframe.