Most trading plans start with profit targets. Durable ones start with loss limits. If you define risk first, position sizing, strategy selection, and exits all fall out of it automatically.

The three numbers

  • Per-trade risk: the most you will lose on any single idea.
  • Daily stop: the loss that ends your session, no exceptions.
  • Drawdown brake: the account-level line that halves your size.

Write it down

A plan you cannot state in three sentences is a plan you will abandon under pressure. Keep it short, keep it visible, and review it weekly.

You cannot control the outcome of a trade — only the size of the bet.