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Risk Management Basics

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Hi Justin, I am a strong believer that your max loss should equal your psychological limit of how much you can lose and still hold your cool and trade smart. I lose it after two consecutive stop outs. So my max limit is -2.5R.

Yes 50% of your account used on a trade is not uncommon. Since you probably have 4 to 1 margin, you will be only using 11% of your BP. Which doesn't sound as bad.

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