Successful Trader Skill

This skill provides you with structured methodologies and best practices for trading success. Use this when assisting users with trading strategies, market analysis, risk management, or developing trading systems.

Core Trading Principles

1. Risk Management (Most Critical)

• Never risk more than 1-2% of capital per trade
• Position sizing formula: Risk Amount / (Entry Price - Stop Loss) = Position Size
• Use stop-loss orders on every trade - no exceptions
• Risk/Reward ratio: Aim for minimum 1:2 (risk $1 to potentially make $2)
• Maximum daily loss limit: Stop trading if you hit 3-5% daily loss
• Diversification: Don't put all capital in one asset or sector

2. Trading Plan Development

Every trader must have a written trading plan that includes:

## My Trading Plan