How to create a MetaTrader 5 (MT5) Set stop loss and take profit in the middle | Best Risk Management Strategy Guide

MetaTrader 5 (MT5) It is a powerful trading platform that provides multiple order types and risk management tools to help traders execute trades more efficiently while reducing potential losses. Whether beginners or experienced traders, understanding and mastering these features is crucial for optimizing trading execution and controlling risks.Why is order type crucial

MT5 Provide multiple types of orders, including market orders, pending orders, stop loss orders, take profit orders, and moving stop loss orders.
Different ordering methods can significantly affect transaction execution, slippage control, and final profit and loss. Each type of order has its specific purpose, helping traders to perform precise operations under specific market conditions. Reasonable use of order types can help improve transaction consistency and avoid unnecessary losses.

Why risk management is crucial in trading

Risk management is the foundation of successful trading. Lack of risk control may lead to serious losses, fund withdrawals, and even liquidation.
MT5 Provide various risk management tools, such as stop loss orders, position size calculators, automatic risk control functions, etc. Mastering these tools can help traders improve overall trading performance while controlling risks.

MT5Analysis of Order Types in

MetaTrader 5 Provide multiple order types to accommodate different trading strategies. Mastering the operational mechanisms of various orders is the key to improving trading efficiency and risk control capabilities.

Market order（Market Orders）

Market order refers to a buy or sell order that is immediately executed at the current market price. Although the transaction can be guaranteed, the specific price cannot be guaranteed as the final transaction price is affected by market liquidity and volatility.

• Buy market order: buy assets at the current market price
  
  
• Sell market order: Sell assets at the current market price
  
  
  
  

Applicable scenarios:

• Traders who need to enter immediately
  
  
• In a highly liquid market, the difference between the transaction price and the lower unit price is relatively small
  
  
• Dealing with sudden news or strong market trends
  
  
  
  

Hanging an order（Pending Orders）

Hanging an order is an order that is automatically triggered when the market price reaches a predetermined level. Suitable for traders who do not want to continue monitoring the market, but expect the price to reach a certain level.

• Buy limit order（Buy Limit）Buy when the price drops below the set value below the current market price
  
  
• Sell limit order（Sell Limit）Sell when the price rises above the set value above the current market price
  
  
• Buy stop loss order（Buy Stop）: Above the current market price, triggering a buy when the price rises to the set value
  
  
• Sell stop loss order（Sell Stop）Below the current market price, triggering a sell when the price drops to the set value
  
  
  
  

Combination order type:

• Buy stop limit order（Buy Stop Limit）After the price exceeds the set level, place a limit order and buy at a better price
  
  
• Sell stop loss limit order（Sell Stop Limit）After the price falls below the set level, place a limit order and sell at a better price
  
  
  
  

This type of pending order is suitable for breakthrough traders, balancing entry efficiency and slippage control.

Stop loss order（Stop-Loss Orders）

Stop loss orders are the most fundamental and critical risk management tool. It allows traders to automatically close positions when the price reaches a predetermined loss level, thereby preventing further losses.

Example
Traders use 1.1000 Buy EUR/USDSet the stop loss price to 1.0950When the price drops to 1.0950 At this time, the system will automatically close the position.

Suggest controlling the stop loss risk of each transaction within the account funds 1–2% Within.

Take profit order（Take-Profit Orders）

Take profit orders can be automatically closed when the price reaches the set profit target, helping traders lock in profits and avoid missing out on profits due to greed or reversal.

Example
Traders use 1.1000 Buy EUR/USDSet the take profit price to 1.1050If the price rises to 1.1050The system will automatically take profits.

Mobile stop loss（Trailing Stop Orders）

Mobile stop loss is a dynamic stop loss setting that automatically adjusts as the price moves in a favorable direction, thereby locking in profits while continuing to hold positions, suitable for trend markets.

Working Principle:

• The trader sets a fixed point (e.g30Stop loss on point movement;
  
  
• When the price moves in a favorable direction, the stop loss level also moves up accordingly;
  
  
• If the price rebounds, the stop loss level remains unchanged and the position will automatically close when triggered.
  
  
  
  

Advantages:

• Real time profit locking without manual adjustment of stop loss;
  
  
• Prevent the risk of backlash caused by sudden market reversal;
  
  
• Reducing emotional interference in trading helps to execute disciplined trades.
  
  
  
  

Order Execution Strategy

MetaTrader 5（MT5）Allowing traders to choose the execution method of orders will directly affect trading efficiency and costs.MT5 Provide four execution modes:

• Instant execution（Instant Execution）：
  The broker must complete the order at the price requested by the trader, otherwise it will be rejected. When a trader places an order, the platform will automatically include the current price. If the broker accepts the price, the order will be executed; Otherwise, a 'requote' will occur（Requote）”The broker provides new quotes for execution.
  
  
• Market Execution（Market Execution）：
  Brokers execute orders at the best available price in the market, even if the price is different from the requested price.
  
  
• Request execution（Request Execution）：
  [This section is not explained in detail in the original text. If translation is needed, additional content can be added based on the context.]
  
  
• Exchange Execution（Exchange Execution）：
  [This section is not explained in detail in the original text. If translation is needed, additional content can be added based on the context.]
  
  
  
  

Transaction Strategy Options（Fill Policy Options）

MT5 Provide three trading strategy options. Choosing the appropriate trading strategy is crucial for traders when dealing with large transactions or low liquidity assets

• Complete all transactions or cancel（Fill or Kill）：
  Either all orders are completed or completely cancelled.
  
  
• Immediate transaction or cancellation（Immediate or Cancel）：
  The tradable portion will be executed immediately, while the remaining portion will be cancelled.
  
  
• Return（Return）：
  The tradable portion will be executed immediately, while the unexecuted portion will be kept as pending orders and continue to wait for execution.
  
  
  
  

MetaTrader 5 Risk Management in China

Risk management is one of the most critical components in successful trading. Even with a perfect strategy, without good risk control, it may lead to significant losses or even liquidation.MetaTrader 5（MT5）Provide a variety of tools to help traders control risks, manage losses, and maintain long-term profitability.

Position size and leverage

Although leverage can significantly amplify the potential returns of CFD traders, it also increases risk. Therefore, traders must have a deep understanding of the concepts of leverage and position size in order to effectively control risk.

The impact of leverage on risk

Leverage allows traders to control larger trading positions with less capital. Although this can amplify profits, it also greatly increases risks.

For example, in1:100Under the leverage, traders only need to100A deposit in US dollars is sufficient for opening1A position of ten thousand US dollars. If the market experiences reverse volatility1%The loss is100The US dollar is equivalent to the entire principal.

The higher the leverage, the greater the trader's risk exposure and the more volatile the profit and loss fluctuations.

How to determine the appropriate size of storage space

Position management refers to determining the amount of funds invested in each transaction based on an individual's risk tolerance. A reasonable position size can ensure that a single loss will not have a significant impact on the overall account funds.

stayMT5The steps for calculating the size of a warehouse:

• Determine the proportion of risk that each transaction is willing to bear (such as the balance of the account)1%）。
  
  
• Set stop loss points（pips）。
  
  
• Calculate the number of trading lots to be used based on the risk amount（Lot Size）。
  
  
  
  

Risk return ratio（Risk-to-Reward Ratio, RRR）

The risk return ratio is used to measure the ratio between the potential gains and potential losses of each transaction. High risk return ratio can enable traders to achieve even if their winning rate is insufficient50%Still able to maintain overall profitability.

For example:
If the stop loss is set to20Point, set the take profit to40Point, then the risk return ratio is1:2(Every loss)1Unit, potential earnings2Unit).

The ideal risk return ratio for different trading strategies may vary:

• Scalp trading（Scalping）：1:1 or 1:1.5
  
  
• Intraday trading（Day Trading）：1:2
  
  
• Band trading（Swing Trading）：1:3 Or higher
  
  
  
  

Withdrawal management（Managing Drawdowns）

Withdrawal refers to the percentage decrease in account funds from the highest point to the lowest point. Controlling drawdown is crucial for the long-term survival of traders and needs to be addressed through effective risk management strategies.

Suggested approaches include:

• Set a maximum loss limit for a single transaction: control the risk of each transaction within the account funds1%–2%。
  
  
• Set daily maximum loss limit: If the daily loss exceeds the set percentage, trading should be stopped.
  
  
• Diversify trading risks: avoid trading highly correlated assets simultaneously and reduce overall risk exposure.
  
  
  
  

A significant pullback often leads to traders losing control of their emotions and experiencing 'revenge trading'（Revenge Trading）Behavior refers to attempting to quickly recover losses and increase risk. This usually leads to more severe losses. Traders should take timely breaks after consecutive losses and re-examine their trading plans to avoid emotional decisions.

stay MetaTrader 5 (MT5) Common errors in placing orders and risk management

Even experienced traders, in MT5 High cost mistakes may also be made when placing orders or managing risks. Understanding these errors and avoiding them can significantly improve trading efficiency and profitability.

Wrong ordering operation1. Using the wrong order type

One of the most common mistakes is choosing the wrong order type, resulting in transactions that do not match expectations.
For example, a trader originally intended to set a limit order to obtain a better trading price, but mistakenly placed it as a market order, resulting in immediate trading at the current market price.
Therefore, traders are MT5 Before confirming the order, it is necessary to double check whether the order type is correct.

2. Stop loss and take profit settings are too close

If the stop loss and take profit are too close to the entry price, even small fluctuations in the market may trigger the stop loss and miss the original profit opportunity.
For example, traders set up in high volatility markets5Point stop loss, the price easily hits the stop loss before turning in a favorable direction.
Therefore, traders should set reasonable stop loss and take profit levels based on market volatility, and it is recommended to combine them Average true wave amplitude（ATR）Indicator Set an appropriate distance.

3. Orders not adjusted according to market conditions

The market is dynamically changing, and sticking to static stop loss or take profit settings without adjustment may lead to unnecessary losses.
Suggest using when trading for profit Mobile stop loss（Trailing Stop） Function to automatically optimize the stop loss price as the market progresses.

Excessive use of leverage and improper position management1. Using excessive leverage

Leverage amplifies profits and simultaneously amplifies losses. Many traders abuse high leverage, resulting in significant risks to their accounts.
For example, an account has only $1,000 Traders, using 1:500 Leverage has been established $500,000 The position only requires market fluctuations 0.2% It may be forcibly liquidated.
Therefore, especially novice traders, it is recommended to control the leverage ratio and use 1:10 to 1:50 Leverage is used to reduce risk.

2. Neglecting the principles of position management

Many traders invest too much money in a single transaction, resulting in severe drawdown.
Suggested compliance 1–2% The rule is that the maximum risk of each transaction shall not exceed the balance of the account1–2%。
If leverage and position control are not appropriate, traders may completely liquidate their positions after a few trades.

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Poor risk return ratio management1. Using a low risk return ratio

Many traders use 1:1 Or a lower risk return ratio, where the potential loss is equal to or higher than the potential profit.
For example, if the risk is50Point, and the profit taking target is only30Traders will need a high winning rate to maintain profitability.
Suggest setting at least 1:2 The risk return ratio is to ensure long-term profitability.

2. Do not evaluate transaction performance

If historical trading records are not reviewed and analyzed, traders are likely to repeatedly make the same mistakes without realizing it.
Suggested use MT5 Comes with transaction log（Trading Journal） Or third-party analysis tools to track and improve trading performance.
Good risk return management can maintain overall profitability even if the winning rate is average.

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Open an account immediately, and Ultima Markets Open your index togetherCFDA journey of trading.MetaTrader 5 (MT5) It is a powerful trading platform that provides multiple order types and risk management tools to help traders execute trades more efficiently while reducing potential losses. Whether beginners or experienced traders, understanding and mastering these features is crucial for optimizing trading execution and controlling risks.