Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these and earn maximum returns.
The best position size for a trade is determined by dividing the money you’re risking on that position by your trade risk.
The size of your position is determined by the risk per trade you take. It will tell you the number of shares, lots, or contracts to buy or sell for each trade.
1% of your capital is a good starting point for the amount of money you should risk per trade.