Risk Rules Quick Reference
Core Risk Rules
| Rule | Value |
|---|
| Max Risk/Trade | 2% |
| Max Daily | 3-5% |
| Max Weekly | 10-15% |
| Max Drawdown | 15% → STOP |
| Max Concurrent | 3-5 |
Position Size = Risk Amount ÷ Stop Pips ÷ Pip Value
Example:
Risk: $100
Stop: 50 pips
Pip Value: $10
Position = $100 ÷ 50 ÷ $10 = 0.2 lots
Risk/Reward Requirements
| Win Rate | Min R:R |
|---|
| 70% | 0.43 |
| 60% | 0.67 |
| 50% | 1.00 |
| 40% | 1.50 |
| 30% | 2.33 |
Minimum R:R: 1:1 (2:1 ideal)
Stop Loss Rules
| Situation | Stop |
|---|
| Support bounce | Below support |
| Trend pullback | Below pullback low |
| Range trade | Outside range |
| Breakout | Below breakout |
Stop Rule: Set and forget. Never widen.
Daily Limits
| Limit Hit | Action |
|---|
| 2% daily | Reduce size 50% |
| 3% daily | STOP TRADING |
| Revenge thought | WALK AWAY |
Drawdown Rules
| Drawdown | Action |
|---|
| 5% | Normal - continue |
| 10% | Cut position size 50% |
| 15% | STOP TRADING |
| 20% | Full pause + review |
Loss → Recovery %
10% → 11.1%
20% → 25%
30% → 42.9%
50% → 100%
Quick Check
☐ Risk per trade ≤ 2%
☐ Stop in place? Yes
☐ Target ≥ 2:1? Yes
☐ Max trades not hit? Yes
☐ Daily limit not hit? Yes
☐ Emotion check → Calm?
Emergency Rules
- If emotional → STOP
- After loss → STOP
- Daily limit → STOP
- Revenge thought → STOP
Risk before reward.