Course › Level 3: How not to lose your money

Stop loss and take profit, decide before you enter

Every trade has three numbers, and you set all three before clicking buy or sell:

• Entry, where you get in
• Stop loss (SL), where you admit you're wrong and the platform closes the trade automatically for a small, planned loss
• Take profit (TP), where the platform banks your win automatically

Where does the stop go?

Behind the level that made you take the trade. Buying at support? Stop goes below the support, with breathing room, because volatile markets (especially synthetics) routinely spike a little past a level before going the right way. A stop placed exactly at the obvious level gets clipped by noise; give it margin and size the trade down to keep the dollar risk at 1%.

The 1:2 rule

Aim to win at least twice what you risk (risking $2 to make $4+). At 1:2, you only need to win 4 trades out of 10 to be profitable. That's the whole business model of trading: small controlled losses, bigger wins, repeated.

A trade without a stop loss isn't a trade. It's a donation with extra steps.

Mark lesson complete