What percent of money should i risk on trading?

<p id="isPasted">The simplest and most effective way to protect your equity through risk management is to establish strict loss parameters and abide by them. One popular method is the 2% Rule, which means you never put more than 2% of your account equity at risk (Table 1).</p><p>For example, if you are trading a $50,000 account, and you choose a risk management stop loss of 2%, you could risk up to $1,000 on any given trade. The powerful beauty of this rule is that if you strictly adhere to it, you would have to make dozens of consecutive 2% losing trades to lose all the money in your account. Even for a new trader, this is highly unlikely.</p><p>Although often used by traders, the 2% threshold is completely arbitrary. You certainly could operate with tighter or looser parameters. But, to manage your risk effectively, you need to choose a level that makes you feel comfortable and stick with it.</p>