7 Days of Trading Challenge: Trading Risk Management Challenge

Monday: Launch of the Challenge

Today's mission: Understanding the basics of risk management
Today, we're going to lay the foundations of risk management in trading. Learning how to define an acceptable risk per trade and how to use risk management tools such as stop-loss and take-profit will help you protect your capital while aiming for consistent gains.

Tasks to be performed :

• Playback and Video :
  • Read an article on risk management and discover fundamental principles such as the risk/reward ratio, calculating the capital to risk per trade, and the importance of stop-loss.
  • Listen to our podcast on how to define a solid risk management plan.

Recommended resources :

• Article : A complete guide to risk management in trading

• Podcast: Risk management strategies for traders

• Configuring your chart :

  • On your trading platform (MT4, TradingView, etc.), familiarize yourself with risk management tools, including stop-loss and take-profit.
  • Learn how to calculate your position size based on your capital and risk level.

• Observation:

  • Choose two assets (for example, EUR/USD and Gold) and note their volatility levels. Consider the risks associated with these assets.

Tuesday to Thursday: Analysis and Strategy

Three-day mission: Develop and implement a risk management strategy

Tuesday: Defining the risk/reward ratio

Today, we're going to focus on calculating the risk/reward ratio for each trade. Understanding this ratio is crucial to assessing whether a trade is worth taking, taking into account the risk you're willing to take.

Tasks to be performed :

• Define a risk/reward ratio for your trades (e.g. 1:2 or 1:3).
• Calculate your position size based on this ratio and your capital.

Wednesday: Using Stop-Loss and Take-Profit

Learn how to use stop-loss and take-profit to limit losses and guarantee gains. These tools are essential for managing risk and preserving your capital.

Tasks to be performed :

• Place stop-losses and take-profits on your charts for the trades you are analyzing.
• Identify the technical zones where these levels of protection should be placed (e.g. below support levels or above resistances).

Thursday: Backtesting and strategy adjustments

Test your risk management strategy over past periods. Backtesting is an excellent way to see if your approach is viable before applying it in real trading.

Tasks to be performed :

• Backtest your strategy over the last few weeks.
• Adjust your strategy if necessary according to the results of backtesting, notably by modifying your ratios or adjusting your stop-loss levels.

Friday: Practice

Today's mission: Execute your trades according to your risk management
It's time to apply your risk management in real-life conditions. It's time to put into practice the principles you've learned during the week.

Tasks to be performed :

• Place your trades with a stop-loss and take-profit defined according to your strategy.

• Respect your position size and risk criteria for each trade.

• Trading Journal :

  • Keep a diary detailing each trade you make: the reason for entry, the stop-loss and take-profit levels, and the progress of the trade.

Saturday: Review and Adjustments

Today's mission: Analyze results and adjust your approach
Today, we're going to analyze Friday's trades to see how well risk management worked. You'll adjust your strategy according to what went right and what went wrong.

Tasks to be performed :

• Review Friday's trades: which were winners, which were losers and why?

• Identify whether your risk level was adequate and adjust it according to performance.

• Adjustments :

  • Modify your risk management parameters, for example by adjusting position sizes or stop-loss levels, if necessary.
  • Try different strategies to see if you can improve your performance.

Sunday: Taking stock and sharing

Today's mission: Review the week and share your results
The last day of the challenge is an opportunity to review your progress and share your successes with the community.

Tasks to be performed :

• Summary :
  • Write up a complete report on your trading week: What did you learn? Which strategy worked? Did you improve your risk management?
• Share :
  • Share your results and thoughts on social networks. Use the hashtag #xenesy and tag @xenesy_project in your posts.
  • Encourage other participants to share their experiences to create a dynamic, interactive community.

Conclusion

Risk management is one of the most important skills you can develop in trading. By mastering risk management, you'll be better prepared to face the ups and downs of the markets while preserving your capital. This challenge has enabled you to understand how to define appropriate risks, use tools such as stop-loss and take-profit, and apply effective strategies. We hope you'll continue to hone your risk management skills to become a more disciplined and profitable trader.

Good luck to you all, and see you soon on the markets!