Before trading, first set the maximum loss you can bear per trade—not how much you could make. Position size should be determined by the stop-loss distance: the farther the stop-loss, the smaller the position; the closer the stop-loss, but it must still not exceed your account’s risk limit. Don’t use borrowed funds or your living expenses. Don’t increase your position to average down just because you’ve had consecutive losses. And don’t repackage “no stop-loss” as a long-term investment strategy. A truly stable strategy ensures that when a judgment is wrong, it won’t do lasting damage to you.