What are the factors affecting risk?

not looking at intra-trade volatility. it's one thing to string a bunch of returns together and look at total return, but if you are not analyzing vol and drawdown over the wealth curve, you could go bust without realizing.
 
Klein_0 said:
Can you please name the factors that increase or decrease trading risk?
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Risk in trading is influenced by factors like leverage, market volatility, and position size. Basically risk is negative outcome multiplied by its probability. Or aggregate of such outcomes multiplied by their odds. Proper risk management involves considering the risk-reward ratio, market conditions, and avoiding emotional decision-making to navigate potential challenges.
 
Understanding the meaning of the word is the issue most have.

Clue: risk it not a dollar amount.

Think of insurance (life, auto, home etc), which is to insure against the risk of something happening. Not x number of dollars the risk of loss, partial or otherwise.
 
Risk is influenced by various things like market ups and downs, economic situations, and the use of leverage. Diversifying where you put your money, interest rates, how easily you can buy or sell stuff (liquidity), global happenings, rules changing, and how much risk you're okay with all play a part. Knowing these factors helps make smarter choices and handle risk better.
 
Several factors can influence your trading risk, including the use of leverage, market volatility, emotions, your application of risk management, and, of course, your trading knowledge.
 
ForexCrusader said:
Several factors can influence your trading risk, including the use of leverage, market volatility, emotions, your application of risk management, and, of course, your trading knowledge.
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I don't think it needs to be even that complicated. If you get in at the WRONG PLACE at WRONG TIME, the possibility of you getting stopped out is almost always guaranteed.
 
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