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Risk Management
Automated trading is a powerful tool, but it gives a machine access to your capital. That is why risk management is the absolute foundation of the TTMT platform. Every trade passes through multiple layers of protection before a single order is placed.
Core Principle: Never Trust Signal Volume
This is the most important safety rule in the system. TTMT never uses the lot size from a signal provider's message. Every trade's volume is calculated fresh from your own configured risk settings.
A signal provider might say "Buy 5.0 lots GOLD" -- TTMT ignores the "5.0 lots" entirely and calculates the appropriate volume based on your account balance, risk percentage, and stop-loss distance.
Position Sizing Modes
TTMT offers three methods for calculating trade volume. Each mode ensures your risk is controlled and predictable.
1. Fixed Lot Size
You specify a static volume (e.g., 0.10 lots) for every trade, regardless of the stop-loss distance.
| Advantage | Disadvantage |
|---|---|
| Simple, predictable | Risk varies between trades -- a 100-pip SL risks 10x more than a 10-pip SL |
Best for: Beginners who want simplicity, or traders who manually adjust lot size between sessions.
2. Percentage Risk (Recommended)
You specify a percentage of your account balance to risk per trade (e.g., 1%). The system calculates the lot size so that if the trade hits the stop loss, you lose exactly that percentage.
Formula:
Total Volume = Risk Amount / (Weighted SL Distance x Contract Size)
Where:
Risk Amount = Account Balance x (Risk Percent / 100)
Contract Size = From broker symbol specification
(100,000 for forex, 100 for gold, etc.)Why "Weighted" SL Distance? Because the 12-order system enters at different prices within an entry zone, each layer has a different distance to the stop loss. The system computes a weighted average reflecting the true aggregate risk across all layers. This means the system can afford slightly more volume than a naive single-order calculation, because the average entry price is better when layers fill.
Example
Account: $10,000 | Risk: 1% | SL: 200 pips on EURUSD
Risk Amount = $10,000 x 1% = $100
Contract Size = 100,000
SL Distance = 0.0200
Total Volume = $100 / (0.0200 x 100,000) = 0.05 lotsWhether SL is 20 pips or 200 pips, you always risk exactly $100.
Best for: Professional money management. Consistent risk regardless of SL distance.
3. Fixed USD Risk
You specify a fixed dollar amount to risk per trade (e.g., $50). The system calculates lot size so that your maximum loss on SL hit is exactly that amount.
Total Volume = Fixed USD Amount / (SL Distance x Contract Size)Best for: Volatile instruments where you want hard dollar limits, or traders who think in dollar terms rather than percentages.
Per-Asset Risk Overrides
Different instruments have different volatility profiles. TTMT allows you to set custom risk parameters per asset class, so you can size gold differently from forex, and indices differently from crypto.
Available asset classes:
- Forex (EURUSD, GBPUSD, etc.)
- Metals (XAUUSD, XAGUSD)
- Indices (NAS100, US30, SPX500)
- Crypto (BTCUSD, ETHUSD)
- Commodities (USOIL, Natural Gas)
Each asset class can independently configure:
| Override | Description |
|---|---|
| Volume mode | Fixed Lots, Risk%, or Fixed USD -- independent per asset class |
| Volume value | The lot size, risk percentage, or dollar amount |
| Max volume cap | Hard limit on the maximum lot size for this asset class |
| Default SL | Fallback stop-loss distance (pips) when signal does not provide one |
| Default TPs | Fallback TP levels (pips) per TP1-TP6 |
Example Configuration
| Asset Class | Mode | Value | Max Volume |
|---|---|---|---|
| Forex | Risk% | 2% | 1.0 lots |
| Metals | Fixed USD | $75 | 0.50 lots |
| Indices | Fixed Lots | 0.05 | 0.10 lots |
| Crypto | Risk% | 0.5% | 0.20 lots |
Hard Volume Caps
Regardless of your risk settings, TTMT enforces absolute maximum position sizes based on the trade's risk level:
| Risk Level | Maximum Volume | When Applied |
|---|---|---|
| Normal | 5.0 lots | Standard trades (1.0x multiplier) |
| Mid | 7.5 lots | Moderate confidence trades (1.5x multiplier) |
| High | 10.0 lots | High conviction trades (2.0x multiplier) |
These caps are non-negotiable. Even if your percentage risk calculation yields 12.0 lots, the system caps it at the applicable maximum.
WARNING
Per-asset max volume caps (configured in asset overrides) are applied in addition to these global caps. The lower of the two always wins.
Entry Zone Validation as Risk Control
The entry zone validator acts as an additional risk control by classifying entry zones into five categories:
| Classification | Action |
|---|---|
| Valid zone | Normal processing |
| Inverted zone | Auto-corrected (low/high swapped) |
| Narrow zone | Compressed -- layers are closer together |
| Wide zone | Capped at 3% for forex, 5% for metals/crypto |
| Invalid zone | Rejected -- trade is not executed |
Wide zone capping is particularly important: a signal with an entry zone spanning 10% of the price would create enormous risk exposure. The validator prevents this by capping the zone width.
Stop Loss Protection
Missing SL Handling
If a signal arrives without a stop loss, TTMT considers it "infinite risk." Three configurable behaviors are available:
| Behavior | Action |
|---|---|
| Use default SL | Apply your configured default SL distance (e.g., 600 pips). This wide stop is intentionally conservative for emergency situations. |
| Skip trade | Reject the signal entirely. Most conservative option. |
| Correct SL | Attempt to derive a reasonable SL from the entry zone and TP distances. |
Invalid SL Detection
The SL validator catches several dangerous conditions:
- Wrong-side SL: A BUY signal with SL above entry (would close immediately at a loss).
- Too-far SL: SL distance exceeds 5x the TP1 distance (risk/reward is severely unfavorable).
- Zone implausibility: SL is more than 5x the SL distance from the entry zone boundaries.
Exposure Monitoring
Margin Level Tracking
TTMT monitors your account's margin level in real time. Before opening a new trade, the system checks that sufficient free margin is available. If margin is insufficient, the trade is rejected with a clear error message.
Pre-Trade Validation
Every trade passes through 5 pre-trade checks before any orders are submitted:
- Broker connection: Is the connection to your broker active and healthy?
- Symbol availability: Does the broker offer this symbol?
- Volume within limits: Is the calculated volume within caps?
- Margin sufficient: Is there enough free margin for the trade?
- Safety pause: Has the account's automatic safety pause not been triggered?
The automatic safety pause is particularly important -- it stops trading on an account after a configurable number of consecutive failures, preventing runaway losses during broker outages or connectivity issues.
Recovery Guidance
The dashboard includes an automatic Recovery Guidance system that activates when your account experiences significant drawdown:
| Loss Threshold | Severity | Guidance |
|---|---|---|
| 10% of balance | Informational | Warning notification. Review recent trades. Consider reducing risk per trade. |
| 20% of balance | Caution | Stronger warning. Suggested actions: pause auto-trading, reduce lot size, review channel performance. |
| 40% of balance | Critical | Urgent warning. Strong recommendation to pause all trading. Review and adjust strategy before continuing. |
These thresholds are calculated against your starting balance (not equity) and update in real time as trades close.
Emergency Controls
Kill Switch
The dashboard provides an emergency kill switch with two scopes:
| Scope | Action |
|---|---|
| Close all | Immediately close ALL open positions on the account, including manually placed trades |
| Close TTMT only | Close only positions managed by TTMT, leaving manual trades untouched |
The kill switch closes all positions at once. If any individual close fails, it continues closing the rest.
Channel Pausing
You can pause individual channel-account assignments at any time to stop receiving signals from specific channels without affecting others. This is managed through the channel settings and takes effect immediately.
Best Practices
Golden Rule
Never risk more than you can afford to lose. A recommended maximum is 1-2% per trade for most traders.
| Practice | Why |
|---|---|
| Start with demo | Test your settings on a demo account before risking real capital |
| Use Percentage Risk mode | Consistent risk regardless of SL distance |
| Set per-asset max volumes | Prevent over-leverage on volatile instruments |
| Configure default SLs | Protect against signals that omit stop losses |
| Review Recovery Guidance | Act on drawdown warnings before losses compound |
| Use Trade Preview | Check the Trade Preview before changing settings to see the exact impact |
Settings Resolution Hierarchy
When multiple settings sources exist, TTMT resolves them in this priority order (highest to lowest):
Signal Value > Channel Profile Override > Account Settings > Asset Override > System Default- Signal-provided values take highest priority (e.g., SL from the signal)
- Channel profile overrides from config profiles
- Account settings (your base configuration)
- Asset overrides (per-symbol modifications)
- System defaults (fallback values)
Volume is the exception -- it is always calculated from your settings, never from the signal.
Related Pages
- Order Execution -- How the 12-order system uses your risk settings
- Order Management -- Volume calculation details and numerical examples
- Signal Processing -- Validation pipeline that filters risky signals
- Breakeven Management -- Automatic stop-loss protection after TP hits