Risk management
How to calculate risk on a futures trade, in three steps: how much to risk per position, whether the strategy survives variance, and what a drawdown costs to recover. Kelly, risk of ruin and drawdown calculators in one place.
Calculating risk on a futures trade means answering three separate questions, and this section is the index to them. How much of the account a single trade may lose is a sizing question. Whether a sequence of those trades ends the account is a variance question. What it takes to climb back is arithmetic. Each tool below opens the calculation that answers one of them; for the ratio between a stop and a target on a specific trade, use the risk-reward ratio calculator instead.
The ratio, and the win rate it demands before you make money.
The mathematically optimal fraction of your account to risk per trade.
The odds your strategy blows up before it pays off.
A 50% loss needs a 100% gain. See what yours needs.