Hi Support,
could You show in statistics even the Average Risk($)/Equity($) ratio ?

Best regards,
Frank

Hi Frank,

Great Idea! I too would love to see this!

Cheers,
fifty_fifty

Do you mean the average position by "Average risk"?

Hi Support,
I try to explain:

Let's consider one trade:
Equity= 100000, Amount=2 mio, StopLoss= 30 pips then
Risk($) = 200* 30 = 6000 $

Risk($)/Equity($) ratio = 6000($)/100000($) = 0.06


Let's consider a second trade:
Equity= 100000, Amount=5 mio, StopLoss= 30 pips then
Risk($) = 500* 30 = 15000 $

Risk($)/Equity($) ratio = 15000($)/100000($) = 0.15



Now the Average of Risk/Equity ratio, for the two trades, is:
Average Risk($)/Equity($) ratio = (0.06 + 0.15)/2 = 0.105


Best regards,
Frank

Hi,
here is a better example:

Let's consider one trade:
Equity= 100000, Amount=2 mio, StopLoss= 30 pips then
Risk($) = 200* 30 = 6000 $

Risk($)/Equity($) ratio = 6000($)/100000($) = 0.06


Let's suppose the first trade lost so Equity= 94000

Let's consider a second trade:
Equity= 94000, Amount=5 mio, StopLoss= 30 pips then
Risk($) = 500* 30 = 15000 $

Risk($)/Equity($) ratio = 15000($)/94000($) = 0.159



Now the Average of Risk/Equity ratio, for the two trades, is:
Average Risk($)/Equity($) ratio = (0.06 + 0.159)/2 = 0.109


Best regards,
Frank

Hi,
a real Risk Management suggests that this ratio should be for each trade max 0.02.
Of course the lower is better.

Best regards,
Frank