What leverage do you use?

That's eactly what drtermines what size I trade.

$50,000 maximum risk is 2% so $1,000 then work out from there.

what I am amazed at is the size of leverage many people use....

 

i only risk 2% on any given day, but i use 200:1 on any side of any trade i do i'm so hedged up

 

10:1

 

Usually about 15, but ranges between 10 and sometimes as high as 30.

 

FWIW, I saw an interesting study a few years back (for futures), that seemed to indicate that about 7X leverage was the optimal tradeoff between risk & reward.

 

Thats the answer.

First determine stop size (in pips). Then what % that stop size represents of your account (usually 1 to 3%).