Why using Stop Loss will not burn your account while avoiding its use can be catastrophic for your assets?

The answer is simple, with a stop loss you limit the loss up to that point, no more...

But how much is good, how much risk should I take, how much loss is correct if that happens?

That question is very common and I really get asked it a lot.

The answer lies in the type of trading you do... It is not the same for a scalper as it is for an intraday or spot position trader.

But I hope to help with the following idea.

The risk reward ratio should be 1:1, 1:2, 1:3 or even 1:4 according to the types of trading

1:1 For Position or Spot Trades

1:2 for swing or intraday trades

1:3 For intraday or scalping trades

Now, one thing is the risk reward ratio and another is how much I should risk...

Spot or trading position 10 to 30%

Intra day or swing 2.5% to 9.9%

Intra hour or scalping 0.25 to 2.49%

These percentages are healthy and in line with the time in operation. When for some reason you opt for them and the trade is invalidated, you can have coverage as protection either within the same asset or in another...

If you have any ideas, questions or comments, write to me and we'll talk about it.

AMTrading