percentage stop losses

maarki

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Hi everyone, posting my first thread. Just wanted some understanding with regards to a percentage stop loss. For example, buy Eur/Usd @1.3700 TP 1.3750 SL 0.5%. So what would be my stop loss.

Thanks in advance.
Maarki
 
Why are you asking in the first place? Why would your stop loss be 0.5%? Your profit target is only 0.36%. This represents a risk:reward ratio of less than 1, meaning you are risking losing more points than you are aiming to win on the trade. This can work if you have an impressively high win rate from all the trades you take, but is generally a recipe for disaster.
 
Hi everyone, posting my first thread. Just wanted some understanding with regards to a percentage stop loss. For example, buy Eur/Usd @1.3700 TP 1.3750 SL 0.5%. So what would be my stop loss.

Thanks in advance.
Maarki

You mean you want to take 0.5% risk on it? To work that out, you need to tell us how much risk capital you have...
 
Thanks for the contributions. I wanted to know how percentage stop losses work and wrote an example (incorrectly i think). So a percentage stop loss would be in relation to my fund. So if i have £10000 in my account the stop loss would be 0.5 of $10000.

Also its not a joke thread thats why i posted this on the first steps forum because im a newbie to this.
 
Thanks for the contributions. I wanted to know how percentage stop losses work and wrote an example (incorrectly i think). So a percentage stop loss would be in relation to my fund. So if i have £10000 in my account the stop loss would be 0.5 of $10000.

Also its not a joke thread thats why i posted this on the first steps forum because im a newbie to this.

I think it's because the way you worded it was 0.5% of 1.3700, which is obviously 1.2700 * 0.995. But it seems what you're tlaking about is 0.5% risk to your account.
So, that's simply:
0.5% * account size which gives you the amount you should risk over the stop loss.
So 0.5 by a £1,000 account = £5 that you are willing to lose on the trade.
If you wanted a stop loss of 40 pips, you do £5/40 = £0.125 per pip or rounded to 13pence per pip.
 
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