Capital Management: Protecting Your Trading Capital

Capital management is a fundamental aspect of effective risk management. This educational guide explores how to protect and manage your trading capital.

What is Capital Management?

Capital management involves strategies and techniques for protecting your trading capital and ensuring you can continue trading even after losses. Understanding these concepts helps traders maintain long-term viability.

Key Capital Management Principles

Position Sizing

Position sizing involves determining how much capital to risk on each trade. Proper position sizing helps ensure that no single trade can significantly impact your overall capital.

Capital Preservation

Capital preservation focuses on protecting your trading capital above all else. This principle emphasizes the importance of avoiding large losses that could end your trading career.

Capital Management Strategies

Different strategies provide different approaches to capital management. Understanding these strategies helps evaluate capital management approaches.

Continue Your Education

• Risk Management Basics
• Risk Management
• Risk Assessment