Rule 1 — Risk a Fixed Percentage Per Trade
Never risk more than 1–2% of your total account on any single trade. This ensures that even a streak of 10 consecutive losses will not destroy your account. Profitable traders think in terms of hundreds of trades, not individual wins.
Calculate your position size before every entry based on your stop-loss distance and your fixed risk amount. Never guess your lot size.
Rule 2 — Never Move Your Stop-Loss Against Your Trade
Once placed, your stop-loss defines the point at which your trade idea is wrong. Moving it further away to avoid a loss is not risk management — it is denial. It turns a defined, small loss into a potentially catastrophic one.
The only acceptable adjustment to a stop-loss is moving it to break-even or beyond once price has moved sufficiently in your favour.
Rules 3–5
Rule 3 — Set a maximum daily loss limit. If you hit 2–3% in losses in one day, close the platform and return tomorrow. Bad trading days compound when you keep trying to recover.
Rule 4 — Maintain a minimum 1:2 risk-to-reward on every trade. Over time, even a 40% win rate is profitable with a consistent 1:2 RR ratio.
Rule 5 — Track every trade in a journal. You cannot improve what you do not measure. The journal is the most underused and highest-impact tool available to any trader.