# Fixed Lot size based on % of balance

* **Set to 0:** Activates automatic lot sizing, where the EA adjusts trade volume based on:
  * Account equity
  * Risk settings
  * Lot Size Multiplier
  * Trading style
  * ...
* **Set to a specific value (e.g., 3):** The EA will risk that percentage of your account balance per trade, calculating the lot size accordingly.

{% hint style="success" %}

#### **When to Use Percentage-Based Risk**

* You prefer trade sizes to scale with your account balance.
* You have a defined risk tolerance per trade.
* You're implementing a strategy that adjusts risk exposure dynamically.

> Example: Setting this to 2 means each trade risks 2% of your current account balance.
> {% endhint %}

{% hint style="warning" %}
**Things to Consider**

When enabled, this setting overrides **dynamic lot sizing**.

This value directly controls the **volume** of each trade based on your account balance. 

It does **not** function as a **stop-loss**. If set too high, it can lead to oversized positions and rapid drawdowns.\
**It’s really acting more like “money I’m willing to allocate,” not “money I’m willing to lose.”**

* Risk scales with balance— can lead to **larger** trades than expected during profitable periods.
* In volatile or losing phases, your trade size reduces, which slows recovery.
* During drawdowns, trade sizes decrease, which can slow recovery.
* Does **not** guarantee loss limitation — trades may go deeper into drawdown if recovery logic is used.
* Combining high percentage risk with aggressive trading styles can lead to significant exposure.

For most traders, especially those with smaller accounts or less experience, it's advisable to use the EA's automatic lot sizing (set to 0) in conjunction with conservative risk settings. This approach allows the EA to manage trade sizes dynamically, adapting to market conditions and account changes, thereby promoting more consistent risk management.
{% endhint %}

{% hint style="success" %}

#### 🛡️ **Safer Alternative:**

Unless you're an advanced user with a large balance and strong risk control, it’s **safer and more effective** to manage exposure using **multiple charts with auto lot settings** — rather than percentage risk.

This gives you:

* Better **risk diversification**.
* Easier **performance tracking** per strategy.
* More control over how each part of your portfolio behaves.
  {% endhint %}

{% hint style="danger" %}

####  **Important**

While this method adjusts trade sizes relative to your account balance, it doesn't guarantee loss limitation. In volatile markets or during consecutive losses, the compounding effect can lead to substantial drawdowns. Moreover, relying solely on percentage-based risk without additional protective measures may expose your account to heightened risk.

* **Ensure that the percentage is in line with your risk management strategy** to prevent excessive exposure on each trade.
* If the market becomes highly volatile, a fixed percentage of your account can result in larger drawdowns.

While percentage-based risk management is a powerful tool, it’s important to understand its potential downsides:

* It’s most effective when you have clear risk management guidelines, and when paired with other protective features, such as [**Hard Stop**](/smartchoise-manual/options/account-protection/hard-stop-only-ea-trades.md) or [Max Drawdown per Trade](/smartchoise-manual/options/trade-management/max-drawdown-per-trade.md).
* It may be more appropriate for **larger accounts** with well-defined risk tolerance.
* For **smaller accounts** or those with less risk tolerance, it’s wise to combine it with conservative strategies or set more rigid limits.
  {% endhint %}

🧠 *Use percentage-based risk for dynamic scaling. Use auto lot sizing for balanced, adaptive risk management.*


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