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Trading glossary · risk
risk
How much money you could lose on a trade if things go wrong.
The fuller meaning
In trade planning, the amount lost if the stop is hit: entry-to-stop distance times size. Risk is decided before entry, kept to a small, fixed share of the account and measured in R; more broadly it is any chance of an outcome worse than planned, such as gaps or correlated positions.
risk.
Related words
1% rule · ATR stop · average loss · average win · breakeven · breakeven win rate · correlation · daily loss limit · drawdown · equity curve