6 - Essential Risk Management strategies ๐
1๏ธโฃ Risk per Trade: Use 1% or 2% of your account balance.
2๏ธโฃ Set Stop-Loss Orders: Is a predetermined exit point for a trade in case it doesn't go as planned.
3๏ธโฃ Risk-Reward Ratio: Commonly used ratio is 3:1 where the potential profit (reward) should be three times more than what you are willing to risk.
4๏ธโฃ Position Sizing: Depending on the risk of the trade, adjust the size of your position. If a trade carries higher risk, reduce the size of your position to minimize potential losses.
5๏ธโฃ Diversification: Even in day trading, it's advisable not to put all your eggs in one basket.
6๏ธโฃ Education and Continuous Learning: Stay updated on market trends, news, and developments. TA and fundamental analyses are vital skills for any day trader.