2% Risk Management Rule For Trading...

#trading #stocks #riskmanagement
A lot of traders struggle to keep their profits because they don't have proper risk management. Learning how to properly size positions is a very important skill to learn when attempting to be a profitable trader in 2023 and to consistently make money from home thru trading. Invest your time and money into learning these techniques to help make your trading journey a lot easier.
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*DISCLAIMER* I am not a financial advisor and anything that I say on this KZbin channel should not be seen as financial advice. I am only sharing my biased opinion based off of speculation and my personal experience. You should always understand that with investing there is always risk. You should always do your own research before making any investment.

[@steveb.1967]

That is a brilliant intro: It's not about how much money you make; it's about how much money you keep.

[@nick19988]

good video, i started with 0.2% per trade for some months and slowly increasing my strategy working and now i risk 3% per trade to start compound my capital till 100-250k then i can quit my job. im also adding weekly money to my account each sunday to grow it consistently

[@taimoorkhan8203]

Appreciate... I have a 2% rule and here is how mine works for me... First I study the market, update demand and supply zones, (avoiding trading in major financial event news day until the news is out), I open multiple small leveraged trades and the sum of all open trades does not to exceed 2% of my total capital out which mostly they end in profit and rarely any one hits my stop loss and even if they hit stop loss I do get back certain portion of my trade in to my capital.. I believe gradual growth is better than blind greedy trades...

[@saimahussain4576]

Please could you help me

[@taimoorkhan8203]

@@saimahussain4576 sure... what help do you need...

[@cjack202003]

This is formation is money. I keep losing a lot of money. Had I used the 2% rule, my account would be green right now, I would be winning more than I lose. Right now, my losses are bigger than my gains, because I have no risk management. I loss $6500 in a week and a half, had I practiced risk management and cut the loss at 2% each day, I would actually be up $100 from my two green days, but instead I'm down $6500, because I had no risk management. I've added it to my rules now and will follow it to a T. I care more about keeping my capital. My gains will come as long as i stick to my rules, but in order for me to stay in the game...i need to be strict with the risk management. I'm out if I'm down 2%, whether it's one candle, two candles, or 3 candles. As soon as I'm down 2%, I'm out.

[@hustlinhitch]

I'm a newbie trader and obviously am gathering knowledge before taking the plunge. Never knew about the 2% rule, so thanks.

[@terrifictec3751]

Hi. I'm also looking to get started.

[@MyDeere3320]

I wish I watch your video 3 days ago. I lost $2600 in two days because I wasn't following my exit strategy.

[@AngelaAngela]

Thank you for taking your time telling us the 2% down side, I think you are definitely a very good person 🎉

[@CheapTrillsBlackOutfit]

Finally, a school lesson that i have genuine interest in and actually want to learn!!

[@peterchan5817]

pop quiz in 5 mins

[@claralucas354]

Great video, trading come with a lot of benefits And I have just bought my first house through it. As a beginner I was scared of loosing my savings but I'm glad I took the bold step that is now favoring

[@magrettalnch]

Congratulations.

[@magrettalnch]

I will love to be your friend dear as well as sharing some i dears which you're benefiting

[@claralucas354]

Okay but is not luck, is all about having good investment plans most of all trading with a trust worthy expert. Watching professional trading videos and most especially connecting with the right person the digital world is full of in unreal people I met some of them during my success journey. I felt same way when I started especially when you use demo account you might be winning but when you put in real money you start losing I understand and I pass through it all. I’m very happy I’m profitable now

[@claralucas354]

Currently i can attest to the fact that I make $18,300 weekly through trading which is more better then my monthly salary job. trading becomes my passive income.

[@claralucas354]

At first i was afraid too before i gave it a try and realized fear kills dream more than failure.

[@XTRADERXNYC]

I risk 3% and aim for 6-9% ….following these rules will keep your account alive for 20 losses in a row

[@prmikey]

The only video in the top search results that ACTUALLY doves into risk management. The other ones just explain why it’s important without ever giving examples or pop out a chart with no way of telling what the position was. Excellent content.

[@ibrahimabdullah9051]

😢I wish I saw 👀 this video like 6 months back 😭 but Allhamdulillah (all praise & thanks belongs to God) I’m very grateful ☺️& Lucky 🍀 I saw this today. Thanks little bro. Appreciate you v v v very much. Now I know where I was screwing up.

[@LD32.]

This is the first video I've watched that explains perfectly Risk Management. some adults need to be explained like babies. THANK YOU

[@fadi682]

I am 1 year in this journey and i think i am so good to watch this videos i realize that i should be humble to be proftable

[@kingkhankk6278]

You guide every one with honesty. I appreciate it. Thanks bro

[@fridayokorie2642]

Most elaborate video I've seen so far on risk management. Thanks for this great video.

[@KV45355]

I risk 10% of my total account :-) that's how much I'm comfortable with.

[@michealscott6811]

Single Handley the best piece of information on day trading you can find on KZbin

[@chandankr2707]

Sir i am from India First time i am watching your video Wonderful teaching sir Best way to protect your money first RRR is important in our trading Risk reward ratio & stop lose should be in your disciplines Thanks sir

[@nanda9671]

@Umar Ashraf is this real channel owner r fake man this commented person

[@smartman3764]

It is obvious that Stop Losing is important, but your presentation makes it more interesting, so go ahead and well down.

[@hasanghasemi2469]

THANKS BRO. I STARTED MY TRADING JOURNEY FROM BINANCE CRYPTO FUTURES WITH LEVERAGE 10 TRADE. TO UNLEARN WHAT I DID , I STARTED FROM (BELOW ) ZERO. MEANING I FORCED MYSELF TO DO 100 TRADES IN CRYPTO WHETHER IN SPOT OR LEVERAGE 1X FUTURES (WHICH IS AGAIN LIKE SPOT ). I CONSIDERED 10 $ FOR THIS CHALLENGE . 8 IN SPOT , 2 IN 1X FUTURES. AS A RESULT MY MAX LOSS TOLERANCE (BASED ON 2%) IS 0.02$ FOR 1X CRYPTO FUTURES AND 0.08$ IN CRYPTO SPOT.

[@pomo5103]

you are legit the only person who's helpful for me to watch

[@bubbyprimetv2981]

It's hard to do 2% when you have a small account like $500 - 1000. Especially when trading options that are leveraged. My personal preference is 15% to 17.5% risk. This allows for some room for the contract price to fluctuate without hitting the stops immediately.

[@evanandersen911]

That’s the same what I do, I do about 15% of my account per trade and haven’t used real money yet but I’ve been paper trading and it’s been really well for me

[@sspencer3356]

I get the thrill of options, but you shouldn’t be touching them if you don’t have the money to lose or are still learning direction.

[@razorraysolarsavings72]

15% lol 😂 👎🏻

[@premnadar3348]

Then dont take leverage

[@malik6730]

😂😂😂

[@AndrewJones-y3b]

One candle trailing stop works wonders without having to know any technical analysis on any time frame.

[@adams5423]

Excellent video! Even seasoned traders should watch it from time to time to stay grounded.

[@theunbanned4553]

Dude this explanation is spot on! Gonna watch the stoploss and probably some more videos. Really great!

[@User-ymc6kyrt78op]

KZbin is a place where gems can be found

[@nathankomorowski8083]

I`ve learnt a lot here, Warren Buffet once said " if you don`t find a way to make money while you sleep you will work until you die, now i understand why?

[@ji-yeonkwak8548]

That was deep! Hardcore fan of Warren Buffet. I got to start investing in mutual funds because of him and i haven`t regretted it

[@muzafferabdelrahman8042]

I wish this was taught in college, and i am just trying research, learn how to trade stocks and options

[@ipahli1214]

This is true But its never too late though its just to make move

[@nathankomorowski8083]

Financial education should be taught in every level of education but because of the misplaced priorities we have in the system, the average man is suffering it

[@davidkaufmann6029]

Exactly! its never too late to start. That`s why i am watching videos on how to trade options and equity

[@patty6339]

I am excited to have bumped into your videos today, one take home from this, focus on the risk side the reward will take care of itself

[@Makabde]

Wish I watched this great content before making errors. Never too late though thanks for this great content!

[@vinayjat]

Do you have risk management calculator of umar Ashraf please send me

[@drjoe1886]

Great video. How do you calculate your risk trading options contracts? Do you go by the underlying chart or options chart to calculate your risk and number of contracts? Thanks.

[@john237711]

Eye opener for beginners wish i seen it 2year ago would save a lot as learning alot thanks bro god bless

[@GeoffreyDionne]

Thanks for the analysis! 🔍 I wanted to ask something unrelated: 🤔 I only have these words 🤔. (behave today finger ski upon boy assault summer exhaust beauty stereo over). How do I use this? 🤨

[@kharimahmed9680]

May Allah reward you to the fullest

[@raymondturner3952]

Am I wrong but I thought it is forbidden for Muslims to gamble ?

[@OMGWUNSIU]

Been watching XPEV go down since i bought it for $65.00 a while back. the other day i figured out at $31.00 it’s time to stop the bleeding. i was angry at my mistake, but i dumped it... all of it. i felt a lot better watching it dive 5 to 6 % more on the next two days and i wasn’t along for the ride. Given the same scenario i would sell it at $63.00. Live and learn... thanks again Umar

[@a1expresstransportllc956]

What if i’m just averaging down on on my favorite etf or stock? What if i. Simply building a bullish position . Why cut losses if what you’re buying is good etf or spy🤔why sell or take a loss?

[@TranceAnimer]

For me if the account is big enough and depends on how confident i am on the setup i will risk from 0.5% to 1% and on confirmation that setup is valid i can add up. For a smaller account bellow 10k i am willing to do a 4% on a high quality setup 2% on entry and add up to 2% when my position is in profit and i am extra confident. Because 0.5% 1.3 rrr on 200k is enough profit for me but on 10k the same risk and reward its not that tasty. 200k 0.5% is 1000. and 4% on 10k is 400 on the the reasons the bigger the account the better.

[@kishantks3362]

Can you make a video on how to put a stop loss for option trading? Great video!

[@musk3402]

Maybe its in the course? Can someone confirm?

[@a1expresstransportllc956]

I believe you should never cut losses you should buy keep buying and holding.. cutting losses especially tight stop losses are no longer working.. Ai and market makers will hit you stop loss and take your money easy.. instead i would recommend to at least place a wide stop loss and look at bigger charts timing the market doesn’t always work buying and holding works better.

[@iboroffor9031]

This is the video I've waiting for! Thank you immensely, Umar!

[@mkhalid2000]

Thank you Umar, Amazing explain!!

[@mortezamohammadimortem4808]

Thank you very much, you are helping me understand alot about both the market and myself

[@AZeroSum]

You are not dividing the share price BY the potential loss, it’s the other way around. You are dividing your %/trade BY the possible loss. Just to help mention.

[@KoellePineault]

You're doing a fantastic job! I have a quick question: My OKX wallet holds some USDT, and I have the seed phrase. (behave today finger ski upon boy assault summer exhaust beauty stereo over). How should I go about transferring them to Binance?

[@justhuman1225]

Lets say on a USD 2000 account, What if I lost the first trade and equity goes to 1860, so the question is what would be my next max stop loss would it be 37.2 this time and so on and vice versa if I won the first trade. Just tell me what do you do with your trades

[@smeshnoymatvey2054]

I also want to add to add that risking 2% on an intra-day setup is far riskier than risking 2% on a daily-chart setup. These look same on excel sheet but they are not same. Also it is important to use wide stop loss as they have less probability of getting hit. But you will have to reduce your position size.

[@RotterStudios]

Wide and very wide stop losses also get hit....ask me how I know.

[@fortuneflux]

@@RotterStudios I can take a guess ... but how do you know? Are the magic words "market makers" and " with their own trading desk"

[@fiinreea]

Depends on your entry point. Get in at the right price and your stop loss can be more tight.

[@JRM---516]

I'm a high-position trader. Lots of research -- minimum speculation. 1% trailing stop loss. In my first 5 months trading I made 238K. "Trading" is my world!

[@JRM---516]

@officialumarAshraf009 Been beat up a few times since -- as you know: there are no short-cuts.

[@claudetoussaint1862]

This video is : THE VIDEO that I was looking for. Thanks a bunch.

[@GMakgathoSA]

Not to mention that you explain easier? though in SA, i like you, your likeable person. keep it up.

[@familyreyes234]

Your are a great teacher. Thanks so much for this information Umar Ashraf...Take care

[@JMHubart]

hello Umar, question: what type/brand screens do you use? looks great and easy, thank you

[@markcyrus7898]

Risk Management is an important aspect of trading every investor must be aware of if they seek to become successful on their trade venture.

[@annabelwillemse6997]

Most beginners forget its importance and hop into the market making losses.

[@rachealjones6039]

@@annabelwillemse6997 am one of those beginners, I thought trading was easy like those ads described but it turns out to be very volatile with lots of ups and downs📈

[@dimitrispapat1395]

I made a huge loss last month, I don't think I would ever bounce back from it. Lots of wrong trades despite watching youtube videos. Can't seem to know what I did wrongly.

[@markcyrus7898]

,@@rachealjones6039 trading as a beginner without proper skills and guide can be very risky, the stock market can be very profitable to invest in, and I'll advise you make adequate research on stocks before trading. To be safe you should probably get an expert an expert for more profitable trade.

[@rachealjones6039]

@@markcyrus7898 actually I have got plans of getting an expert to help me, I plan on doing things differently this time around. Can you recommend any to me

[@peacewalker5587]

So basically the 2% rule is if you have 2k and 2% of that is 40 so if the stock is 10 and the stop loss is at .50 that would be 80 shares. So in total you would need to spend 800 on shares in order to lose 40 from that 800.

[@galgalgal8007]

Very clear and concise explanations

[@aak48]

This video is golden, thank you 🙏

[@michaelsturgill736]

protect the down side is my new life motto

[@sam7707_]

Well said Ustaad I will do as u said my Teacher 😎👍🏻

[@mariajelani1237]

Asalmoalikum Umar bhi u made an incredible video always use proper risk good suggestion

[@jorgeteixeira1922]

You are a good man Umar, you make the well. Thank you.

[@Mark_Jacobson81]

2 dislikes. They’re pissed they blew up their accounts 😬

[@chinawhite932]

I agree, I do not know who would not appreciate his advice.

[@freemind2025]

I was about to write the same thing 😭

[@abhinayreddy4469]

@@freemind2025 man ,😂😂

[@poojamane1567]

Hi Umar like you said we need to buy 40 shares with a $2000 capotal if we are risking 2%.But waht if the premium is much higher and we are not able to buy 40 shares in $2000?

[@angjy560]

what is your strategy winning % and what is your average reward per trade?

[@angjy560]

please help 😂

[@hamza361]

it’s difficult sticking to the 2% per trade rule when your seeing several winning trades. That’s where the real challenge is.

[@LALAKERSHOW]

Lmao true I had a tight stop loss, only for the stock to spike right when I took a loss horrible feeling

[@user-rl4wy1ys8k]

That's where your mindset and discipline is tested.

[@massive323]

christ, wish i'd seen this a week earlier - got liquidated for 65k the other day. gulp

[@JOSHUAINSIGHTS]

In my opinion, 2% per trade is not a wise decision. It’s supposed to be 2% per day. What good is it risking 2% on one trade when you can still blow the account at the end of the day

[@chrisconti7916]

Perfectly described, thank you Umar.

[@tarisotzendera6758]

Detailed video, thank you❤

[@crooper04]

Thanks man, that helped me a lot. Great video!

[@valkme203]

Where can I find the video on stop loss?

[@sports-highlights-tv]

Loud and clear umar thanks,

[@nd-kay]

Thank you!

[@ZenTradeGame]

Great video !

[@wric01]

Unlikely unless you keep your eye on it every min. 5% stop loss is more realistic as the time you react to time of actual trade is volume dependent / whales can move more than 2% per 30 sec.

[@방재웅-q9v]

좋은 강의 감사합니다

[@mattd7770]

Hello @UmarAshraf28 did you ever make the video about how to use stops? About Where to place stops?

[@tatheerjumani4044]

Very good advice I hope to see all your videos

[@andyfieldmagic]

Umar this was an excellent video. Please do keep more coming. A SL video would be greatly appreciated.

[@zakkaderi]

it took me time to learn this .. but it did change my trading career when i started to implement it in my trading .. great video Umar .. keep it up with the great educational videos .. cant wait for the stop loss video

[@oleksandrdzyubak6282]

When calculating a buy size you suggest "same thing 50 cents divided by 40" which literally gives you 0.5/40 = 0.0125 that is not correct. I assume you meant to say the other way around: "40 dollars divided by 50 cents" 40/0.5 = 80 (shares). Right?

[@Camptheuniverse]

I will be back trading full throttle in a few months ;)

[@DRMET-vy7ci]

How did it go?

[@bcrysinfinity7323]

Thans again bro Umar for this learning video.. Keep it up

[@mucmac3586]

great advices!

[@gengopal9686]

Mann intro video is W

[@sabahtaha1746]

day trading position size between 0.25 and 0.5% per trade per day

[@NiciO.G]

Is it okay to have multiple trades open at the same time at 2% risk for swing trading or would that let you get potentially draw down too much from temporary overall market conditions ???

[@gaetanolopez7779]

How many positions do you keep at once? if you have 5 positions open, and you lose them all, you lose 10 per cent. Do you keep more positions open if you trade with the 1 per cent instead?

[@futurestraderjohn3438]

Brilliant Lesson learnt, I needed this. Cheers

[@Domiguy777]

Im an ict trader trading only eu 2% is a sweet spot to me

[@NoumanKhan-rn7kk]

Grear Explanation sir, really Loved it

[@NtalajaCilumba]

This video really helped thanks a lot 🎉

[@musatraderisb]

Excellent explain and teach Risk Management.

[@axe8039]

Thank you Umar🙌🏻

[@josephshoemate9933]

Great clip. Thanks.

[@madelineprusak]

Thank you for this!! Very informative and as a new trader (one month) I was unaware of the importance of protecting the captial with the 2 or 1% rule.

[@Gizmodian81]

Disagree with this, risk management depends on win rate and expectancy of your strategy…using a Monte Carlo simulator could help with defining your risk limit…sometimes max risk could be as low as 0.1%.

[@nitta1915]

very good and easy to learn. thank you

[@chumpyloomps8961]

I do 0.5% and only trade 1:3 risk to reward or higher

[@mohamadhashim9915]

Assalamualaikum ya akhi. Anta mumtaz. Ana mohamad min malaysia. JazakaAllah khair

[@G6Trade]

You just made me realise what mistake i was doing that i didn't even notice. Thanks a lot,you have no idea how much it will help me correcting that mistake 👍👍👍

[@jaymaxxmusik9925]

great video. break right down