The original "Daily Loss Limits Save Careers" thread got ten posts, which is a lot for this board, and around it there's a set of smaller threads that refine the idea. Here's what they add up to on the setup side: how big, what counts, and how to split it.
Hard stop and soft stop do different jobs
The most useful refinement is the two-stop idea from the hard vs soft thread. The hard daily stop is an account or platform rule, written before the session, non-negotiable. The soft stop is a process brake: after two full losers or a clearly bad read, you slow down, cut size or switch to watching. Confusing the two is how people either blow the day or quit on noise. The replies there all ran some version of the same split.
The advanced notes thread puts numbers on it. The soft stop sits at about two thirds of the hard limit. Half was tried first but triggered on normal days so often it got ignored. Two thirds is late enough to mean something and early enough to leave room for one managed exit.
How big
The original thread suggested around 3 to 5 percent of equity. The replies pushed back for scalpers specifically: one runs tighter than that on pure scalp days, another sits near 1 to 1.5 percent soft daily on a personal account. The reasoning is that scalping generates many decisions per session, and a big daily limit gives room for many bad ones. On challenge accounts it's tighter again, since the firm's limit already exists and stacking both needs thought.
What counts
The beginner questions thread answers the usual ones well:
- Money or R? Both, written down. R for process, money for the fear check.
- Does a winner reset it? No. It's for the calendar day, not your mood after one scalp.
- Do news spike losses count? Yes. If you were in, it counts.
The layered system thread adds weekly and monthly limits on top, like -2 percent daily, -4 percent weekly, with a monthly one above that. It also suggests a trailing daily stop: once the day is up a set amount, only part of the gain can be given back.
Two threads split the daily budget by session. One uses 1.25 percent for London and 0.75 percent for New York on a 2 percent daily. The other runs 0.5R Asia, 1R London, 1R NY, mainly to force sequence, so a bad Asia session can't borrow from London. Both agree unused budget doesn't roll forward.
A reply on the session budget thread asks the obvious question: the buckets add to 2.5R, so where's the hard stop? If it's 2R, a bad morning and a bad afternoon can still hit it before NY's bucket is used. The buckets and the hard stop have to agree, or one of them is fiction.
Enforcement
The original thread has a Pine Script loss cap enforcer in the replies, and other threads mention platform tools and EAs that flatten and block trading. Nobody argues for willpower alone.
Where do you set your soft stop relative to your hard one, and does the soft stop actually change what you do?
Threads this pulls from
- Daily Loss Limits Save Careers
- Daily, Weekly and Monthly Loss Limits: Building a Layered System
- Hard daily stop vs soft mental stop, why I use both with different triggers
- Advanced notes on daily loss limits
- Beginner questions about daily loss limits
- Splitting the Daily Risk Budget Between London and New York
- Session risk budget: 0.5R Asia / 1R London / 1R NY example
