Penny Stock Trading Risk Management: Cash & Position Sizing - Timothy Sykes: "Foreign exchange trading has one of the purest examples of cash management and using margin. Since forex uses a lot of margin there is a general rule of thumb that you do not want to risk more than 2% of your account on any one trade. This might sound low, but with the massive margin anything more becomes too much, because things can spiral. 2% forms your cutoff, because at that point your trade is probably going the wrong way."
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