I am posting messages to Telegram to go long. I would like to know if I can post a position size in % of wallet balance which can then be used by a Cornix bot to open the long/short ? Why ? See below … Let’s break it down with a simple example:
For example, if the account balance is $10,000, the risk per trade is $200 if we want to risk only 2 %. With a stop-loss of 0.75% of the entry price, the position size can be scaled so that a 1% move (the target gain) yields a profit of around $266–$270. This is roughly a 2.67% gain on the account for that trade—not merely 1%.
Fixed Risk per Trade:
You risk a fixed 2% of your account (say $200 on a $10,000 account) every time you trade.
Stop-Loss and Position Sizing:
Your stop-loss is set at eg 0.75% below your entry price. To ensure you lose only $200 if the stop-loss is hit, you calculate a large position size. This means you’re buying enough units so that a 0.75% drop equals $200 in loss.
Take Profit Calculation:
Even though your take profit is set at a eg 1% gain (a small move), because you are trading a large position (thanks to your tight stop-loss), a 1% move translates into a profit that is much larger relative to your $10,000 balance. For example, a 1% move might net you about $270—which is roughly 2.7% of your account—not just 1%.
Compounding Gains:
Every time you win, your account balance increases. Since you always risk 2% of your current balance, winning trades lead to a larger risk amount in subsequent trades. This means your gains grow faster, and over 24 trades, the cumulative effect can push your total gain up up up.
In short, even though each trade is targeting a 1% price move, the combination of large position sizes (due to tight stop-losses) and the compounding effect of increasing your account balance is what allows you to achieve a high gain.