I have a little confusion regarding my risk per trade management. I am unclear if I need to calculate this absolute amount each time with the new account value or the risk per trade is calculated once and reused no matter if the account size grows or decreases.

Consider the following example:

Let's say I have an account of \$1,000, I decide to risk 1% of it: \$1,000 * 1% = \$10. Assuming I entered a trade and lost, account size remaining will be \$990. Do I need to recalculate that risk based on the new account size, i.e. \$990 * 1% = \$9.9?

If this is the way I notice something that could not be so beneficial, consider this next hypothetical case:

You win and lose, consecutively let's say 10 times. When you do the math you will notice that the next per-trade value is decreasing in a spiral fashion. This makes me so confused, I don't exactly know which way to go.

• If the odds are 1 to 1 and the probability is 50% then the second wager of 9.90, if correct, will still not break-even after losing the first wager of 10. Maybe the second wager should be 10.10 ? Jan 6, 2023 at 19:40
• Please use a spellchecker next time. Jan 7, 2023 at 15:55