Risk tools for retail forex traders

Set a risk per trade, scale lot size to volatility and add a daily loss limit. Then backtest the rule with those settings on your broker's data.

Why position size matters

• Most retail CFD accounts lose money. In 2018 the European Securities and Markets Authority (ESMA) reported that 74-89% of retail CFD accounts lose money.
• Leverage increases losses. After the US capped retail forex leverage in 2010, losses of high-leverage traders fell by 40% (Heimer and Simsek, Journal of Financial Economics, 2019).
• Volatility changes the risk of a fixed lot. In currencies, scaling positions to volatility did not meaningfully raise returns but reduced extreme losses (Harvey et al., 2018).

In Kalibre Lab

• Risk-based position sizing: set the share of balance each trade risks. The lot is calculated from the stop distance.
• Volatility scaling: risk per trade is reduced when volatility rises above its normal level (EWMA, Yang-Zhang, GARCH).
• Daily loss limit and news filter: stop trading after a set daily loss and stay out around high-impact releases.
• Your broker's data: backtest on your broker's prices, then confirm in MT5 Strategy Tester with your broker's costs.

Your broker

Kalibre Lab is not a broker. It does not open accounts or route orders. It works with any broker that offers MetaTrader 5. Use a broker authorised by the regulator in your country.