Hey guys
I am new to trading and am at the moment doing some studies before jumping in. I am familiar with the concept of trading with a risk reward ratio but am unsure as to which level i should set my risk. I will be starting off with swing trading. I will be using a leveraged account with a 5% margin and plan on being a pretty conservative trader. I am trying to come up with a trading plan and was thinking that my risk or R would be set at the 5% of the stock value. eg. if it was a $100 stock my stop would be set no lower than $95, which if i stopped out would be kind of like losing my own money (if i avoid slippage). is this a sensible strategy and should i look ONLY for oppurtunities where this is possible or is this a bogus concept???
i have watched some training videos but they did not mention this.
I am new to trading and am at the moment doing some studies before jumping in. I am familiar with the concept of trading with a risk reward ratio but am unsure as to which level i should set my risk. I will be starting off with swing trading. I will be using a leveraged account with a 5% margin and plan on being a pretty conservative trader. I am trying to come up with a trading plan and was thinking that my risk or R would be set at the 5% of the stock value. eg. if it was a $100 stock my stop would be set no lower than $95, which if i stopped out would be kind of like losing my own money (if i avoid slippage). is this a sensible strategy and should i look ONLY for oppurtunities where this is possible or is this a bogus concept???
i have watched some training videos but they did not mention this.
should my R be a percentage of stock value
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