How to Size Positions Around the 1% Rule

he short answer: Work backwards from dollars, not lots. Your total open risk across all live positions can't exceed 1% of account size – $1,000 on a $100K account. So divide that $1,000 across however many trades you plan to run at once, then set each position's size from its stop distance: dollar risk ÷ stop distance = max lots. Keep the running total under $1,000 and you never breach.

That's the method. Here's how it works in practice.

What the rule measures

The 1% rule measures your total open exposure at any given moment, not your loss on a single trade. If you have three positions live, the combined risk of all three has to stay under 1% of account size.

On a $100K account, 1% is $1,000. Whether that's one trade risking the full $1,000 or five trades risking $200 each, the ceiling is the same. Cross it and you're in breach territory.

This applies to Instant Funding only. The 2-Step Challenge doesn't carry a 1% open-risk rule – so if you're on a 2-Step account, skip this one.

How to calculate risk per position

Risk on a single position is the distance between your entry and your stop, multiplied by your position size. Get into the habit of starting from the dollar amount you're willing to risk and working back to the lot size – never the other way around.

The formula: dollar risk ÷ stop distance (in price terms, accounting for pip or point value) = your maximum position size for that trade.

Say you're on a $100K account, so your ceiling is $1,000. You want a single EUR/USD trade with a 20-pip stop. At roughly $10 per pip per standard lot, a 20-pip stop risks $200 per lot. To use the full $1,000 on that one trade, you'd size up to five lots. Want room for other positions? Size smaller.

Managing multiple open positions

This is where most breaches happen. A trader sizes one position perfectly, opens a second without recalculating, and the combined risk quietly pushes past 1%.

Two ways to handle it:

• Budget split. Decide up front how many positions you'll run at once, then divide your 1% across them. Four positions on a $100K account means $250 of risk each. Predictable, and no mid-trade math.

• Running total. Track your live open risk as a single number. Add a position, add its risk to the total. Close one or move its stop to break-even, subtract it. As long as that number stays under your ceiling, you've got room to add more.

Moving a stop to break-even frees up that position's risk budget – once the stop can't lose you money, it stops counting against your 1%. That's a clean way to open new trades without breaching: bank one position to break-even, then deploy the freed-up room elsewhere.

Why the rule works in your favor

A 1% open-risk cap reads like a constraint, and on the surface it is. It's also the best guardrail against the mistake that ends most funded accounts: overexposure. Stacking correlated positions – long EUR/USD, long GBP/USD, short USD/CHF, all effectively the same dollar bet – is how traders turn one bad move into a blown account. The 1% rule forces you to size that exposure honestly.

It also pairs with the 6% trailing drawdown. Tight open risk means a single losing session can't drag you near your floor in one shot. You stay in the game longer, and staying in the game is the whole point.

The quick checklist

Before you open any position on Instant Funding:

• What's my ceiling? (1% of account size)

• How much risk do I already have open right now?

• How much room is left?

• Does this new position fit inside that room?

If the last answer is no, size down or wait for a position to clear. That's the whole discipline.