Position sizing on a small account

[Shadow Trader]

A small account creates a real conflict. Risking one percent of a few hundred dollars means risking a few dollars, which on a tight scalping stop means a lot less than the minimum lot size allows.

Many beginners resolve the conflict by increasing risk until the numbers fit the minimum lot. A 3 pip stop on 0.01 lot costs about thirty cents. That sounds fine. But when the broker's minimum size forces ten times the intended risk, a few losses wreck the account.

Options include micro lots or cent accounts where available, wider stops that allow proper sizing, or simply accepting that the account is too small for the strategy and treating it as practice.

The temptation to use high leverage to compensate is strong, and dangerous. Leverage lets bigger positions open, but it doesn't change the maths of risk per trade.

Is the position size dictated by the risk rule or by the smallest lot the broker allows?