How much should you risk per trade?

Short answer: risk a small, fixed percent of the account on each trade, sized from your stop. Between 0.5% and 1% suits most people; 2% is the top of the usual range. The right number is the one that lets your worst losing streak pass without forcing you to change how you trade.

Risk is what you lose at the stop, not the position size

Risk per trade means the money you lose if the stop fills, as a percent of the account. It is not the size of the position. A $4,000 position with a stop 2.5% away risks about $100; on a $10,000 account that is 1%. Decide the risk first, put the stop where the idea is wrong, and the position size follows. The position size calculator does the arithmetic, fees included.

What a losing streak does at each risk

Losing streaks are not bad luck to be avoided; they are a certainty to plan for. Here is how far the account falls after five, ten and fifteen losses in a row, risking the same percent of the current balance each time:

Risk per trade	5 losses	10 losses	15 losses	Gain to recover from 10
0.5%	−2.5%	−4.9%	−7.2%	+5.1%
1%	−4.9%	−9.6%	−14.0%	+10.6%
2%	−9.6%	−18.3%	−26.1%	+22.4%
3%	−14.1%	−26.3%	−36.7%	+35.6%
5%	−22.6%	−40.1%	−53.7%	+67.0%

At 1% a trade, ten losses in a row is an uncomfortable month. At 5% it is a 40% hole that needs a 67% gain to climb out of. The gap widens because losses compound: the deeper the drawdown, the bigger the gain needed to get back, as the drawdown recovery table shows.

How long a losing streak should you expect?

Longer than most people guess. These are the typical longest losing runs, worked out exactly from the win rate:

Win rate	Typical over 100 trades	Typical over 200 trades	1 in 10 traders, 200 trades
35%	9 in a row	10 in a row	15 or more
40%	7 in a row	9 in a row	13 or more
50%	6 in a row	7 in a row	10 or more
60%	4 in a row	5 in a row	8 or more

A trend-following style that wins 35% of the time with large winners will typically see ten losses in a row over a couple of hundred trades. Pick a risk at which that streak is survivable, emotionally as well as on paper.

How to choose your number

1. Start from the drawdown you can live with. If a 20% drawdown would make you abandon your plan, the risk has to keep your likely worst streak well under that.
2. Use your own losing streak. Take your win rate from your journal and look up the streak above, or simulate thousands of runs of your exact edge with the risk of ruin simulator.
3. Leave room for a bad day. If you trade a prop firm account, its daily loss limit decides the maximum: several losses in one session must stay inside it.
4. Keep it fixed. Risk the same percent every trade. Raising risk to win back a loss is how a normal drawdown becomes a blown account.

Is risking more ever right?

More risk only pays if the edge is real and measured, and even then there is a ceiling. Every positive edge has a risk per trade at which the account grows fastest; above it, growth slows and the swings get brutal, and further still the account shrinks even though the average trade wins. The expectancy calculator shows both points for your numbers. Professionals sit well below them.

What The Print Room does

Every call on the desk states the percent of the account it puts at risk before entry, and the record counts each close at that risk. A +2R close at 1% is +2% on the account; a loss at the stop at 1% is −1%. That is why the record is printed in R and in percent of the account, never in leveraged return on margin.