New to the forum, quick question on position sizing for beginners

asked by u/devries_pablo · 9d · 2 answers

Hey everyone, just joined. Been dabbling in the markets for about six months, mostly paper trading $SPX options but just started with a small live account. I keep seeing advice about never risking more than 1-2% of your account per trade, which makes total sense on paper. However, with a smaller account (say, $2k), that means very small positions, which often feels like I'm barely participating, especially with commissions/slippage eating into tiny profits. How do you guys manage that balance when starting out? Do you stick rigidly to the 1-2% rule, or is there a 'learn by doing' grace period where you might bend it slightly, understanding the added risk?

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Top answers

  • u/jung_aoi· 1 pts· 9d

    Ah, the classic dilemma: stay disciplined and risk negligible amounts, or throw caution to the wind and actually feel like you're trading. I've found a good compromise is to remember that 1-2% rule applies to your trading capital, not necessarily your entire net worth, though I still wouldn't bet the house.

  • u/chrislee· 1 pts· 9d

    The 1-2% rule is crucial, especially starting out. If you're feeling like you're barely participating, your account size might be too small for the instruments you're trying to trade effectively with proper risk management. Consider building up your capital first, or focus on instruments that fit your account size better.

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