What Are Standard Market Risk Rules and Good Trading Practices?

What Are Standard Market Risk Rules and Good Trading Practices?

In the professional world of trading, risk management isn't optional — it’s the foundation of long-term success and capital preservation.

At Quant Funded, we expect all traders on Funded Accounts to follow Good Market Standard Rules and Risk Management Practices — as outlined in our Trader Agreement under Section 5. These are not arbitrary expectations. They reflect how real professional traders operate in institutional environments.

Below is a breakdown of what we consider Standard Market Risk Practices:

🔒 1. Risking No More Than 1% Per Trade This is a global industry standard used by prop firms, hedge funds, and institutional desks. Risking more than 1% of the account on a single position is widely considered reckless and indicative of gambling, not professional trading.

Why 1%?

It protects against emotional decision-making.

It prevents large drawdowns that are difficult to recover from.

It allows the trader to survive sequences of losses and remain in the game.

At Quant Funded, risking more than 1% on any single trade is a breach of Good Market Practices, even if a stop loss is used.

🛑 Always Use a Stop Loss A stop loss is a non-negotiable part of a professional trading setup.

Trading without a stop loss:

Exposes the account to unlimited risk.

Invalidates any claim to structured risk management.

Violates the very foundation of our Good Market Rules clause (Clause 5.3.3).

We expect traders to always place hard stop losses on their positions — not mental stops.

📊 Consistency in Position Sizing Suddenly increasing position sizes without a logical, documented strategy is considered deviation from risk management norms.

Examples of violations:

Placing 5–10x larger trades than your previous average size.

Using a larger number of positions in a trade sequence to bypass risk controls.

Overleveraging on news events or with stacked correlated trades.

🚫 Avoid Overexposure and Overleveraging Traders must respect the margin and leverage structure of the account.

Examples of overexposure:

Opening multiple high-risk trades across correlated pairs (e.g., EUR/USD + GBP/USD + AUD/USD in the same direction).

Using excessive lot sizes on high-volatility assets like XAU/USD or indices.

This behavior is not only discouraged — it is grounds for termination under our Forbidden Trading Practices policy.

🤖 No AI, Scripts, or Automated Trading Tools Per Clause 5.3.1(e), using bots, auto-traders, latency arbitrage tools, or mass-entry scripts is strictly prohibited.

Quant Funded provides funded capital to reward real human skill — not software manipulation.

🔁 Avoid Copying Between Accounts or Managing Multiple Profiles Using the same trades across multiple Quant Funded profiles or sharing trade access is a direct violation of Clauses 5.3.2 and 5.3.3.

We have advanced systems in place to detect:

Copy-trading across profiles.

Operating over the $400K max allocation limit through multiple accounts.

Account management or third-party access.

These are all grounds for payout reduction to 10% or immediate account termination.

Final Thoughts At Quant Funded, our mission is to fund skilled, disciplined traders who follow real-world standards. These rules are not arbitrary — they are aligned with how real professionals preserve capital and generate consistent returns.

Violating these risk guidelines is a direct breach of our contract and may result in:

Termination of the funded account

Reduction of any payout to only 10% of total profits

Ineligibility for future funded accounts

To remain eligible for continued funding, follow the rules, manage your risk, and treat this capital with the same care as you would your own.