Affluent Savvy
Photo by Tima Miroshnichenko Pexels Logo Photo: Tima Miroshnichenko

What is the 2% rule in investing?

One popular method is the 2% Rule, which means you never put more than 2% of your account equity at risk (Table 1). 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.

How to impress Lord Shani?
How to impress Lord Shani?

Offer him mustard oil and sesame seeds and chant mantra. This is one of the most popular ways to appease Lord Shani. ... Worship Lord Hanuman. Lord...

Read More »
Is 10k TikTok views good?
Is 10k TikTok views good?

Videos that get between 1000–3000 views mean you have a mid-tier account. Videos that get 10,000+ views mean you have a “head” account. Feb 17, 2020

Read More »
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »

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). 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 in order to lose all the money in your account. Even for a new trader, this is highly unlikely. Although often used by traders, the 2% threshold is completely arbitrary. You certainly could operate with tighter or looser parameters. But, in order to manage your risk effectively, you need to choose a level that makes you feel comfortable and stick with it. 2% Rule Account Size Risk Management Stop Loss Maximum Loss $50,000 2% $1,000 $25,000 2% $500 $5,000 2% $100

Table 1

The 2% Rule also creates a structure for your trading decisions, as illustrated in Table 2. For example, assuming you have a $50,000 account and you want to buy 5 Canadian Dollar contracts, the 2% Rule tells you that you could risk no more than 20 ticks on the trade (5 contracts x $10/tick x 20 ticks = $1,000). If you wanted to operate with a more liberal 50-tick stop, you could only buy 2 contracts. Similarly, if you wanted to buy a larger position, say 20 contracts, you could risk no more than a scant 5 ticks. Using the stop-loss threshold in conjunction with a predetermined risk/reward ratio also can help you establish exit points on your profitable trades. For example, assuming a 2:1 risk/reward-ratio, if you are risking 20 ticks on your 5 Canadian Dollar contracts, you should be looking to make 40 points, thereby making $2,000 if the market goes your way and only losing $1,000 if you get stopped out. 2% Rule and 2:1 Risk - Reward Ratio Account Size Maximum Loss Assuming 2% Stop Loss Number of Contracts Number of Ticks That Can Be Risked ($10/tick) Profit Exit Point Assuming 2:1 Risk Ratio $50,000 $1,000 5 20 40(+$2,000) $25,000 $1,000 2 20 100(+$2,000) $5,000 $1,000 20 5 10(+$2,000)

Table 2

Does cinnamon keep bugs away?
Does cinnamon keep bugs away?

Yes, cinnamon in the sandbox does more than creating a pleasant aroma. The strong, spicy scent also repels bugs—they want nothing to do with it!...

Read More »
Can I apply cinnamon directly to skin?
Can I apply cinnamon directly to skin?

Yes, it's true. This humble kitchen ingredient can do a lot, much more than you can ever imagine. Cinnamon has anti-fungal, antioxidant and...

Read More »
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »

What truly is success?

Success is often defined as the ability to reach your goals in life, whatever those goals may be. In some ways, a better word for success might be attainment, accomplishment, or progress. It is not necessarily a destination but a journey that helps develop the skills and resources you need to thrive.

Success is often defined as the ability to reach your goals in life, whatever those goals may be. In some ways, a better word for success might be attainment, accomplishment, or progress. It is not necessarily a destination but a journey that helps develop the skills and resources you need to thrive. The Definition of Success: Success is often defined as accomplishing your personally-defined goals in life. Because goals are sef-created, what people view as success can vary depending on their needs, goals, and situation. There are many different tactics for how to be successful in life, but the strategy that works best for you may depend on what success means to you. If you think of success as doing well at work or earning a high salary, your professional goals and accomplishments will take priority. While professional success can be one piece of the puzzle, it leaves out many other important areas of life. Family, romantic relationships, academics, and athletics are just a few areas where people may strive for success. Your definition of success may vary, but many might define it as being fulfilled, happy, safe, healthy, and loved. So what can you do to boost your chances of achieving these things? What are some of the habits of successful people? There is no single right way to be successful. What works for you might not work for someone else. There may not be a perfect combination of ingredients that can guarantee success. Still, there are some basic steps you can follow that can improve your chances of being successful in life, love, work, or whatever happens to be important to you.

What is considered rich by age?
What is considered rich by age?

Here's the net worth each generation says you need to be considered wealthy in 2021: Millennials (ages 24 to 39): $1.4 million. Gen X (ages 40 to...

Read More »
Did zodiac signs come from China?
Did zodiac signs come from China?

The zodiac was based on Chinese astrology and was used as a way to count years, months, days, and hours in the calendar. It was formed from two...

Read More »
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »
Which colour purse is lucky?
Which colour purse is lucky?

Black is a very popular color for wallets and luckily, this symbolizes prosperity and wealth. If you are looking to advance your career or increase...

Read More »
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »
Who has the best eyes in the world?
Who has the best eyes in the world?

Eagles. All birds of prey have excellent long-distance vision, but eagles stand out. They can see clearly about eight times as far as humans can,...

Read More »