Profitable trading is not about being right more often. It's about losing small when you're wrong and letting winners run when you're right. Risk management is the part of trading that decides whether you survive long enough to get good.
Fixed-fractional risk
Risk a fixed percentage of your account on every trade — commonly 0.5% to 1%. This keeps losing streaks survivable and prevents single trades from blowing up your account.
Position sizing math
Position size = (account × risk %) / (stop distance × pip value). Calculate this every trade. Never eyeball it.
Stop-loss discipline
A stop is not an inconvenience — it's the contract you have with yourself about how wrong you're willing to be before you admit it. Move stops only in the direction of the trade, never against it.
Drawdown awareness
Drawdown is the peak-to-trough fall in your equity curve. Know your historical drawdown. If you exceed it, stop trading and review before adding more risk.