Learn › Risk Management › Scratch Trade
Risk ManagementScratch Trade
Exiting a non-performing trade near breakeven before the stop is hit.
If a trade hasn't made meaningful progress after 33-45% of its time limit, something is wrong. Rather than wait for the full stop loss, exit near breakeven. This preserves capital for better setups. A scratch (-$0.05) is much better than a full stop (-$2.00).
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Get Early Access →Risk:Reward Ratio
How much you stand to gain vs. how much you risk on a trade.
Stop Loss
A predetermined price where you exit a losing trade — non-negotiable.
Position Sizing
How many shares to buy based on your risk tolerance.
Max Daily Loss
A hard limit on how much you can lose in one day — forces you to stop trading.
Breakeven Stop
Moving your stop to your entry price once the trade moves in your favor.