10 Rules of Risk Management

Risk management is the most important aspect of any trading plan. Apart from the mathematical and strategic methodologies to employ, there are several precautions you can adopt as a trader and consider in your decision-making process. 

  • Never risk more than you can afford to lose.
  • Never forget Rule no.1.
  • Stick to your trading plan.
  • Consider the costs like spread, rollover/swap and commissions. 
  • Limit your margin use and track available margin to avoid margin calls.
  • Always use Take Profit and Stop Loss orders.
  • Never leave open positions unattended.
  • Record your performance and adjust as you progress.
  • Avoid high volatility periods like economic news releases. 
  • Avoid making emotional decisions when trading. 
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