Crypto markets are volatile. Even the strongest coins can dip 20% in a day. Without a plan, it’s easy to get wiped out.
🔹 Key Benefits:
- Prevents emotional, all-in decisions
- Helps your portfolio survive losing streaks
- Builds consistency and discipline over time
🧮 How to Apply the 1% Rule
Let’s say you want to buy a token that costs $2.00, and you’re willing to set a stop-loss at $1.80 (risking $0.20 per coin).
If your total account size is $1,000, you can only risk 1% = $10.
To find out how many coins to buy: $10 (max risk) ÷ $0.20 (risk per coin) = 50 coins
So, you’d only buy 50 coins to stay within the rule.
⚠️ Common Mistakes to Avoid
- ❌ Ignoring the stop-loss because you’re “sure it’ll bounce”
- ❌ Moving your stop lower instead of sticking to your plan
- ❌ Overleveraging (especially with margin trading)
These mistakes break the 1% rule and often lead to major losses.
✅ Combine with Other Tools
The 1% Rule works best when used alongside:
- Stop-loss orders
- Position sizing calculators
- Trading journals
- Technical analysis tools (e.g., RSI, MACD)
🧠 Final Thoughts: Small Risk, Big Edge
You don’t need to hit home runs to win in crypto trading. You just need to manage your risk, stay in the game, and let small wins add up.
“It’s not about how much you make—it’s about how much you keep.”
📥 New to trading? Download our FREE Crypto Starter Toolkit for beginner-friendly guides, wallet tips, and secure investing strategies.