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•Created byProfile pictureNQ1!jr
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NQ1!jrProfile picture@nqjunior·Jul 23

The #1 reason new traders blow up their account (and it's not their strategy)

Most beginners think they need a better entry signal. They don't. They need better position sizing.


Here's the math nobody shows you:


If you risk 10% of your account per trade, it only takes 7 consecutive losses to be down over 50% — and a losing streak of 7 is completely normal, even for a strategy with a 60% win rate. You will statistically hit that streak eventually.


If you risk 1-2% per trade instead, that same 7-loss streak only costs you 7-14% of your account. You're still in the game.


Quick formula to steal:

  • Risk amount = Account size × 1% (start conservative)

  • Stop distance = Entry price − Stop price

  • Position size = Risk amount ÷ Stop distance


Example: $2,000 account, 1% risk = $20. Entry $50, stop $48 (distance = $2). Position size = $20 ÷ $2 = 10 shares.


Most people size their position based on "how much I want to make," not "how much I'm willing to lose." Flip that, and you'll last long enough to actually get good at this.


What's your risk-per-trade rule? Curious how others here size their positions.