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Most traders lose money because they risk too much on a single trade. Before you think about profit, you need to define how much you are willing to lose.
A common guideline is to risk between 1% and 2% of your account per trade.
This keeps losses small and allows your account to survive losing streaks.
If you have a $10,000 account:
That means no single trade should lose more than that amount.
Risking too much leads to large drawdowns that are difficult to recover from. Small, controlled losses allow you to stay in the game long enough to win.
Use the tools below to calculate your exact risk:
Losing 50% of your account requires a 100% gain just to break even. Managing risk is not optional—it is the foundation of profitable trading.
Focus on protecting your account first. Profits come later.