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Strategies and rules to protect your portfolio from large losses.
Why It Matters
Risk management is the difference between surviving and thriving in markets. Even the best traders are wrong 40-50% of the time. What separates winners from losers is controlling losses when wrong and letting winners run. Position sizing, stop losses, and diversification are your shields.
Key Points
- Never risk more than 1-5% of your portfolio on a single trade
- Define your max loss BEFORE entering any trade - and stick to it
- Surviving drawdowns is more important than maximizing gains
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Common Questions
Strategies and rules to protect your portfolio from large losses. Risk management is the difference between surviving and thriving in markets. Even the best traders are wrong 40-50% of the time.
Risk management is the difference between surviving and thriving in markets. Even the best traders are wrong 40-50% of the time. What separates winners from losers is controlling losses when wrong and letting winners run. Position sizing, stop losses, and diversification are your shields.
Never risk more than 1-5% of your portfolio on a single trade
Define your max loss BEFORE entering any trade - and stick to it
Surviving drawdowns is more important than maximizing gains