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The 1–2% Rule
A common risk management guideline: do not risk more than 1–2% of your account balance on a single trade.
Example: Account balance $1,000, risking 2% = $20 maximum loss per trade.
How to Calculate Position Size
Position Size = Risk Amount / (Stop Loss in pips × Pip Value)
Example:
Account: $1,000
Risk: 2% = $20
Stop Loss: 40 pips
Pip Value for EUR/USD (1 standard lot): $10 per pip
Position Size = $20 / (40 × $10) = 0.05 lots
Position Limits by Account Type
Parameter | Cent | Standard | Raw |
Minimum trade | 0.01 lots | 0.01 lots | 1.0 lots |
Maximum per position | 100 lots | 100 lots | 1,000 lots |
Maximum open positions | 200 | Unlimited* | Unlimited* |
Maximum total exposure | — | — | 2,000 lots |
*Within margin requirements.
Risk Management Tips
Calculate your position size before every trade
Use stop loss on every position
Do not overtrade — quality over quantity
Diversify across different instruments
Keep a trading journal to track your performance
Never risk money you cannot afford to lose
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