Risk Management Strategy for Trading: The 1% Rule to protect your capital

3 things to know before placing any trade

Price entry -the price that you buy the asset
Price exit – the price that you sell the asset with a profit
Price stop – the price that you sell the asset with a lost

The 1% rule protect your capital by losing only one 1% when you lose a trade

here is an example of 1% lose
If your capital is 100 and you lose 1% then you only lose 1 dollar
100x.01 = 1

so you new capital is 100 -1 = 99
To recover that 1 dollar you only need to win about 1%
99x.1.01 = 99.99

as the percentage goes up the highest the risk

here is an example of 11% lose

If your capital is 100 and you lose 11% then you only lose 11 dollars

100x.011 = 11

so your new capital is 100-11 = 89

To recover that 11 dollars you need to win about 12%

89×1.12 =99.68

here is an example with 50% lose

if your capital is 100 and you lose 50% then you lose 50 dollar
100x.5 = 50

So your new capital is 100-50 = 50
to recover that 50 dollar you need to win 100%
50×2 = 100

if you were to have 11 losing trade in a row that mean you lost about 11 percent of you total capital, in order to recover you loses will you need around 12 percent gain.

here is a table with % lose and % need to recover the loss, just a close estimate.

Percentage lost	Percentage require to recover the loss – close rage
1%	1.1%
2%	2.1%
3%	3.1%
4%	4.2%
5%	5.3%
8%	8.7%
10%	11.1%
15%	17.6%
20%	25%
25%	33.3%
30%	42.8%
35%	53.8%
40%	66.6
45%	81.8%
50%	100%
55%	122.2%
60%	150%
65%	185.7%
70%	233.3%
75%	300%
80%	400%
85%	567%
90%	900%
95%	1900%
100%	Your lose your Capital