How should position management be done? What is the specific ratio?

Recently, many friends in the square have asked me: "How to increase the position?" "How to adjust when losing?" "How to combine stop-loss and take-profit?" Don't worry, Brother Win will explain it clearly to everyone.

Assuming you have 100u in capital, remember the core:

Position management is essentially risk management. The underlying goal of trading is not to make a profit on every trade, but to be able to afford losses and lose slowly when wrong; to gain when right and gain more; and to avoid account collapse during fluctuations. Therefore, positions cannot be increased arbitrarily; they must be determined by risk budget.

First is the basic position, which is the "default strength" for each trade.

The rule is to use 10% of the current funds as the basic position each time. For example, with an account of 100u, the basic position is 10u, which helps avoid a single trade completely destroying the account.

Second is the dynamic position, which should be adjusted in line with the trend.

After making a profit, recalculate 10% based on the new balance. For example, if 100u becomes 130u, the next basic position is 13u, which is a healthy expansion. After a loss, do not increase the position; maintain or reduce it. For instance, if 100u becomes 90u, the next usable amount can be 10% (9u) or a more conservative 7 - 8u, prioritizing stopping the bleeding during losing periods.

Third is to build positions in batches, breaking down entry risks.

Don't go all in at once; invest 7% each time, divided into 2 - 3 batches. Taking 100u as an example, the first 7u is for testing; if the trend is right, add another 7u for confirmation, and if the trend is established, add a maximum of 7u more. This way, if you are wrong, you won't take a full hit; if you are right, you give a larger position.

Fourth is the stop-loss; first define the worst-case scenario before discussing profits. If you don't know where the stop-loss is, you won't know how big the position should be. Set an initial stop-loss immediately after entering, for example, at -10 points;

If the market rises, gradually move the stop-loss up by 5 - 10 points, turning floating profits into realized profits. The stop-loss is to ensure you can stay in the market.

Fifth is the take-profit; first secure the major profits, then let the small positions run.

Use tiered take-profit strategies, close 70% - 80% when approaching the target within 5 - 10 points, and continue to hold the remaining portion while raising the stop-loss by 5 - 10 points. If it doesn't drop below that, hold on; if it does, gradually exit, which can lock in profits without missing major market movements.

Sixth is the profit-loss ratio, which is key to long-term profitability. My own standards are conservative 1:1, balanced 1:1.5, and aggressive 1:2.6+, even with a win rate of 40%, a high profit-loss ratio can lead to long-term growth.