4xPiP

The 5 3 1 rule in trading is a risk management strategy that can help traders limit their losses. The rule states that you should only risk 5% of your account balance on any single trade, 3% on a group of trades, and 1% on all trades combined. This rule helps to ensure that you don't lose more money than you can afford to lose. It also helps to protect your account from large losses that could wipe you out. Here is how the 5 3 1 rule works in practice: 5% rule : You should only risk 5% of your account balance on any single trade. This means that if you have a $10,000 account, you should only bet $500 on any single trade. 3% rule : You should only risk 3% of your account balance on a group of trades. This means that if you have a $10,000 account, you should only bet $300 on a group of three works. 1% rule : You should only risk 1% of your account balance on all trades combined. This means that if you have a $10,000 account, you should only bet $100 on all trades combi