How is maximum allowed risk calculated for trades with a stop-loss and position size?

Risk per trade is calculated using the following formula:

Risk = (Entry Price – Stop Loss) × Position Size × Contract Size

Let's break that down:

• Entry Price is the price at which you open the trade.
• Stop Loss is the price at which the trade automatically closes to prevent further loss.
• Position Size is the number of lots or units you're trading.
• Contract Size is the standard unit size for the instrument (e.g., 100 for gold/XAUUSD).

This represents your potential risk — not your realized loss. A trade that closes in profit can still count as a risk violation if the floating loss at any point exceeded the allowed limit.

For Instant Funding accounts, the maximum risk is 1% of the current account balance across all open trades at any time. This is measured as the combined floating loss (balance minus equity). You can reach the limit with a single position or with multiple consecutive or simultaneous positions — the rule applies to the combined exposure, not each trade individually.

Example (XAUUSD, $5,000 account — 1% max = $50):

• Trade 1: (4319.21 – 4303.88) × 0.02 × 100 = $30.66
• Trade 2: (4318.99 – 4303.88) × 0.02 × 100 = $30.22
• Combined risk: $30.66 + $30.22 = $60.88 → Exceeds the $50 limit → Account breached.

Note: even if your stop loss is set within the 1% limit, the account will be breached if the floating loss exceeds 1% at any point — regardless of whether the stop loss is triggered.

Commissions and slippage are also included in the total risk calculation, making the effective risk slightly higher than the stop-loss distance alone would suggest.

The maximum allowed risk per trade depends on your account type:

Challenge Accounts (Standard 1-Step / 2-Step / 3-Step): You cannot risk more than your daily drawdown percentage per trade (or combined across all open positions).

• Three-Step Challenge: 2% of account balance
• One-Step Challenge: 3% of account balance
• Two-Step Challenge: 4% of account balance

Instant Funded Accounts: The maximum risk per trade is 1%. All open trades combined must also remain within 1% floating loss at any time.

OMO Accounts: The maximum total risk across all open trades must remain below 2% at any time.

BNPL Accounts: The maximum total risk across all open trades must remain below 2% at any time.

Note: If no stop-loss is set, the risk calculation becomes "unlimited" and is taken from the trade's running (floating) loss. It is strongly recommended to always set a stop-loss.

Updated on: 30/09/2026