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® “Home-Study Course” Study Manual Page 30
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to control risk on EVERY trade regardless of how sure you think the
trade will be.
If you let your winners ride and cut your losses quickly, you can do very
well with a 60% trading system win to loss ratio. In fact, with risk
control, you can sustain multiple consecutive losses without it
devastating your trading account.
Remember, Master Traders continue to use strict risk control on every
trade. Risk control is essential no matter what your skill level is.
Going Bust!
Some traders can start and end their trading careers in just one month.
By not controlling risk and by using improper “Trade Size” a trader
can go broke in no time. It usually happens like this; they begin
trading, get five losses in a row, don’t use proper position size and don’t
cut their losses soon enough. After five devastating losses in a row,
they’re trading capital is now too low to continue trading. It can
happen that quickly!
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