Articles on: Trading Rules

What is the maximum loss I am allowed to risk on a trade?

Risk Management

At FTUK we believe long term success is built on a foundation of good risk management. Our rules around risk management are designed to help traders hold onto their accounts for longer giving them more opportunities to let their trading edge playout in the market over time.


We have several key risk management rules we require all traders to work with.

Traders are not permitted to risk more than 2% of their account starting balance on a single trading instrument.
By default we require all traders to use a stop loss on all trades.
Stop Losses must be placed on open trades within 60 seconds of entering the market.
The system will automatically close positions if a stop loss is not added. This will result in the account incurring a 'soft-breach'.
For traders who need to operate their trading strategies without the placement of a stop loss, for example scalping strategies, we provide a 'No Stop Loss Addon' feature at the checkout. This is automatically plugged into the account and permits normal trading operations without needing to place a stop loss. However the trader must still risk no more than 2% on each trading instrument at any one time.
If a trade is drawn down against the account by more than 2% of the original starting balance the Account Protector will automatically close the position. This will incur a soft breach on the account. Find out more about the Account Protector here.

Trader Tip: Remember, a maximum risk allowance of 2% is not the same as saying that each trade has to risk 2%. The industry standard is between 0-2%, with 1% being the norm. Just because you can risk 2% doesn't mean you should.

Updated on: 12/05/2024