How much of your trading capital do you risk per trade?

[Zaxon]

1% risk per share still leaves you at 10% (etc) total portfolio heat should the market crash and all your shares drop. I know there are some people who won't take a new position until existing ones have break even stops in place. This reduces your total exposure in a crash. I don't operate this way. But for those who are more risk averse, it can be an extra layer of protection.

 

[willoneau]

How you determine the risk also has a lot to do with the % you wish to allocate and what risk profile you personally have.
Slippage and delisting are also factors we should include when determining risk, usually by some % of probability of happening.

 

[Bernfeld]

The maximum percentage of risk that I use is 5%. Over the years, this is the best value for me. When I used 1-2%, the profit was 50% less. The greater the risk, the greater the profit and vice versa. But, of course, the risk should be limited.

 

[tech/a]

The greater the risk, the greater the profit and vice versa.

Yes I agree but the risk doesn't have to increase.
When Trading Futures I often have my full account at risk.

Currently with shares I have 2 positions with 85% of my account committed.

If your portfolio trading then a % or a fixed $ amount is best.
But as I have explained further you can mitigate the initial risk
very quickly.

 

[willoneau]

Yes I agree but the risk doesn't have to increase.
When Trading Futures I often have my full account at risk.

Currently with shares I have 2 positions with 85% of my account committed.

If your portfolio trading then a % or a fixed $ amount is best.
But as I have explained further you can mitigate the initial risk
very quickly.

Hi tech/a , do you build those two positions ?

 

[tech/a]

One yes the other I really liked.