Definition
Max risk per trade / max lot rule
A cap on position size or open risk per trade, absolute (lots) or relative (% of account).
Some firms cap lots per instrument or require open risk under ~2% per position. It's partly risk hygiene, partly anti-gambling enforcement.
Even without a formal cap, sizing against the DAILY limit (e.g. risk per trade = 1/4 of the daily loss budget) is what keeps normal losing streaks survivable.
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General industry definitions — individual firms define terms differently in their own ToS; the decoded rulebook for each firm is the source of truth. Educational, not financial advice.