Risk is a number you write down before you are excited

Separate the pots by the pain they are allowed to cause

Write three labels, on paper if you can.

1. Bills and near cash. Rent or mortgage, food, tax due, an emergency reserve. This money does not enter a market story. A high-interest savings account is not a failure of imagination.
2. Future-you money. Pension and ISA holdings matched to goals more than five years away, sometimes ten. This pot can fall hard on a statement and still be intact as a plan.
3. Risk capital. A sum whose complete loss you have already described to yourself in a full sentence: what changes, what does not. Day trading, if it happens at all, happens only inside this third pot.

If you cannot fill in the third sentence, you do not have risk capital. You have savings you are about to rename.

Leverage, said plainly

Leverage means your exposure is larger than the cash you posted. A small move in the market becomes a large move in your account. That is the entire product. Retail protections at FCA-authorised firms — leverage caps, standardised risk warnings, and negative-balance protection on CFDs — exist because the product hurt people. They do not make the product gentle. Offshore firms that promise “no cap” and a signup bonus are asking you to leave the protection on purpose. Check any firm on the FCA’s register before you send money. A polished app is not a register entry.

Questions for a trading day

• What is the loss, in pounds, that ends the session? Is it written where you can see it without opening a new tab?
• How many attempts are allowed after the first loss? Pick the number now. Three is a number. “Until I am back” is not.
• Where is the exit if you are wrong, and where is the exit if you are right and then the market gives it back?
• Are you adding to a loser because the story got better, or because the price got worse?
• What time do you stand up? Put it in the diary as if it were a train.
• If the platform froze, could you state your exposure in one sentence to another person?

We wrote a composite of a day that ignored the last question, called The session that should have ended at lunch. It is not a case study of a client. It is a pattern.

Questions for a long hold

• When do you need the money, in a year, not a mood?
• What mix of equities, bonds, and cash matches that date? If you cannot say it without a ticker, you do not have a mix. You have a favourite.
• What ongoing charge are you paying, fund plus platform, in pounds per year on today’s balance?
• What decline, in percent, have you already lived through without selling? If the answer is none, your risk tolerance is still a rumour.
• What fact, other than price, would make you sell? Write one. “It went down” does not count. “The goal is now two years away” does.
• Are you doubling a theme you already hold at work, in your house, and in your fund? That is one risk wearing three coats.

A journal that is worth opening

A useful note is dull. Date, instrument, size, planned risk in pounds, actual result in pounds, whether the rule held, one sentence on why you clicked. Screenshot galleries are how people curate a personality. A table is how you find out whether the last twenty decisions made money after costs. If you will not keep the table, you are not researching yourself. You are refreshing a feed.

Scams wear the vocabulary of both camps

• Guaranteed daily returns, “funded accounts” that mostly collect fees, and groups that show only winning tickets.
• Anyone asking for remote access to your device, or for you to move money to a personal account “while compliance checks the broker”.
• Clone firms using a name close to a real authorised firm. The register entry must match the website you are on, not a name that sounds neighbouring.
• Pressure to elect professional-client status so the firm can offer higher leverage. That status gives protections up. It does not give skill.

The FCA publishes warnings and a firm checker. MoneyHelper, which is impartial and free, is a better first call than a stranger in a comment thread if you are choosing a pension or an ISA and you feel lost. Links live on the disclaimer.

When the activity starts to run you

Spread betting is taxed like betting for a reason. The behavioural pattern can match. Chasing, hiding statements, borrowing to stay in a position, and thinking about the next stake while you are meant to be elsewhere are signals, not a phase every serious person goes through. Stop depositing. Tell someone in your actual life. Then use a specialist service.