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Useful Formulas

risk copy

Profusion FX Tip :

 

Using the correct risk management on each position should ensure that your trade is at ‘sleeping point’. Meaning you could happily sleep at night without worrying about your trade hitting stop-loss if the position turns against you.

Money At Risk = Account Balance x Chosen Risk

(Example – £500 x 1% = £5)

Risk Per Pip = Money At Risk ÷ StoplossPips

(Example – £5÷ 15 pip stop-loss = 0.33 per pip at risk)

Lot Size = Risk Per Pip ÷ 10 (1 whole lot = £10 per pip)

(Example – 0.33 ÷ 10 = 0.03)