Currencies and Indices Risk Calculations

Most Traders are struggling to stick to their risk management rules, especially New traders, this is why only 1% of all traders are successful. I believe that every one is a good trader but risk management skill is one hardest this trades find it hard have.

Traders should be taught how to Trade like a Casino, know that you are an investor. By trading like a casino I mean you should always know how much you are risking and how much will you be gaining.

Talking about Nasdaq, only a few traders know how to calculate the specific percentage they want to risk and by that, the will know which lot size to use.

I have created an EA that will help you to be a successful trade, what it does is that, you only tell the EA what percentage you want to risk and where you want your Stoploss to be, the EA will automatically do the Calculation for you..

For more Information about the EA

Or Email:
William Roeder
William Roeder  

Risk depends on your initial stop loss, lot size, and the value of the symbol. It does not depend on margin and leverage. No SL means you have infinite risk. Never risk more than a small percentage of your trading funds, certainly less than 2% per trade, 6% total.

  1. You place the stop where it needs to be — where the reason for the trade is no longer valid. E.g. trading a support bounce the stop goes below the support.

  2. AccountBalance * percent/100 = RISK = OrderLots * (|OrderOpenPrice - OrderStopLoss| * DeltaPerLot + CommissionPerLot) (Note OOP-OSL includes the spread, and DeltaPerLot is usually around $10/pip but it takes account of the exchange rates of the pair vs. your account currency.)

  3. Do NOT use TickValue by itself - DeltaPerLot and verify that MODE_TICKVALUE is returning a value in your deposit currency, as promised by the documentation, or whether it is returning a value in the instrument's base currency.
              MODE_TICKVALUE is not reliable on non-fx instruments with many brokers - MQL4 programming forum 2017.10.10
              Is there an universal solution for Tick value? - Currency Pairs - General - MQL5 programming forum 2018.02.11
              Lot value calculation off by a factor of 100 - MQL5 programming forum 2019.07.19

  4. You must normalize lots properly and check against min and max.

  5. You must also check FreeMargin to avoid stop out

Most pairs are worth about $10 per PIP. A $5 risk with a (very small) 5 PIP SL is $5/$10/5 or 0.1 Lots maximum.