Risk management is the crux of the matter in today’s post.

Did you know that over 85% of traders lose money within their first 90 days, even when they’re using solid strategies or premium signals?

Most of them blame the strategy.

But here’s the truth: the strategy isn’t the problem.

The real issue? Poor risk management.

Many traders think they understand risk management — but they don’t.

In this post, you’ll learn how to protect your Forex or Crypto trading account using a free risk tool I use.

You’ll also get access to the weekly growth strategy I teach my students — to help you stop blowing accounts and finally start growing them.

Let’s dive in right away.

Risk Management in Trading

I’ve seen it too many times.

A trader starts with $1,000, grows it to $1,500, and then loses everything on one bad trade.

Before any trade, ask yourself: How much am I willing to lose if this trade goes against me?

That’s your risk amount — and it’s the foundation of smart trading.

What is Risk Amount in Trading?

The risk amount is the maximum amount of money you’re willing to lose on a single trade.

Trading is not about avoiding losses — it’s about controlling them.

Without setting a risk amount:

• You could lose too much on one trade.
• You blow your account faster than you can learn.

For example:

Let’s say you have $1,000 in your trading account.

If you decide to risk:

• 1% per trade → You’re willing to lose $10
• 2% per trade → You’re willing to lose $20

This number becomes your stop-loss budget — it defines how far the market can move against you before you exit the trade.

Trading is a game of probability, and losses are guaranteed.

But the key is to stay profitable despite the losses.

And this is where Position Sizing comes in.

What is Position Size in Trading?

Position size refers to the method of determining the size of a trade, based on your risk tolerance and the distance of your stop-loss.

It ensures that, no matter how big your trade is, you never lose more than your defined risk amount.

Even with high leverage or large trades, proper position sizing protects your account from big losses.

Example:

• You have $1,000
• You want to risk 2% = $20
• Your trade has a stop loss of 50 pips

To stay within your $20 risk, the system will calculate the exact lot size or trade amount you should enter.

• In Forex: The calculator might tell you to use 0.04 lots (for that currency pair and stop loss).
• In Crypto: It might tell you to enter a $2,000 position with 100x leverage

So your actual risk is still $20.

Most traders get position sizing wrong. One trader told me, “I only risk 2%.”

But when we did the math, he was risking 55% without knowing it.

This is a common mistake, especially among crypto traders.

If you understand position sizing, you can trade with 100x leverage and still only risk 2%.

If you don’t, you can blow your account with just 5x leverage.

That’s why I use the highest leverage available. Not to gamble, but to control my risk properly while taking larger positions.

Here’s what matters most:

• In crypto, position size = the total value of your trade.
• In forex, it’s expressed as lot size.

Luckily, there’s a way all these can be done seamlessly.

Just enter your account balance, stop loss, and risk percentage, and you will get just the required figure.

You don’t have to do the math manually. Use tools like:

• FxCryptoCalculator
• MyFxBook Position Size Calculator
• TradingView + Long/Short Tool + spreadsheet

Just plug in:

• Account balance
• Risk %
• Entry price & stop loss
• Instrument (Forex or Crypto)

And the tool tells you how much to trade.

But first, let’s talk about the risk-reward ratio.

Understanding Risk-Reward Ratio

The risk-reward ratio (R: R) is a simple way to measure how much you’re risking in a trade compared to how much you expect to gain.

Risk-Reward Ratio = Potential Loss: Potential Gain

It helps you decide if a trade is worth taking.

Even if your win rate is low (say, 40%), a good risk-reward ratio can still make you profitable overall.

This is what really determines your profitability — even with a low win rate.

Let’s say:

• Account size = $1,000
• Risk = 2% → $20 per trade
• Target = 1:2 risk-reward → $40 profit per $20 risk

Scenario: 10 trades

• Wins: 5 × $40 = $200
• Losses: 5 × $20 = $100
• Net profit = $100 (that’s 10% ROI)

Even with a 40% win rate:

• Wins: 4 × $40 = $160
• Losses: 6 × $20 = $120
• Net profit = $40 — still a win.

In my next post, I will show you how to calculate the risk-reward ratio and position size, and another very important aspect of trading – journaling.

Let’s round up this post in the next section.

Final Thoughts

Now you know how to:

• Control your risk
• Size your positions correctly

Your next step is to apply this knowledge to real trades.

Because even the best risk management won’t save a bad trade.

Want access to reliable trade setups, signals, and a support system?

Join our community on Telegram (crypto and forex) and join our mentorship session, which has limited slots available.

And stay tuned for the next post — where I’ll show you how to calculate the risk-reward ratio like a pro.

Until then — stop blowing accounts. Start growing them!