Sizing your trade

Your risk depends on three things: pip value, lot size, and your stop distance. A 1-lot EUR/USD trade is ~$10/pip; 0.1 lot is ~$1/pip; 0.01 lot is ~$0.10/pip.

Leverage lets a small deposit control a large position. 1:100 leverage means $1,000 controls $100,000. This magnifies both profit AND loss — which is why beginners should use low leverage and small lots.

Golden rule: never risk more than 1-2% of your account on a single trade.