1. Risking 2% and losing 5 trades in a row is a drawdown of about...?
✅ Answer: About 10%
2. Over-trading most directly increases...?
- Win rate
- Transaction costs and risk
- Patience
- Account size
✅ Answer: Transaction costs and risk
3. 'Drawdown' refers to...?
- Peak-to-trough equity decline
- Total profit
- A daily gain
- Spread cost
✅ Answer: Peak-to-trough equity decline
4. A martingale approach involves...?
- Halving after losses
- Doubling after losses
- Fixed size
- No stops
✅ Answer: Doubling after losses
5. Diversification mainly helps reduce...?
- Overall portfolio risk
- Guaranteed profit
- Spread cost
- Pip value
✅ Answer: Overall portfolio risk
6. A 'risk-free' trade usually means...?
- Stop moved to breakeven
- No stop at all
- A guaranteed win
- No leverage
✅ Answer: Stop moved to breakeven
7. A daily loss limit is meant to...?
- Stop trading after a set loss
- Increase size
- Remove stops
- Add leverage
✅ Answer: Stop trading after a set loss
8. The '1% rule' suggests risking at most...?
- 1% of account per trade
- A 1% profit target
- One lot
- One pip
✅ Answer: 1% of account per trade
9. A stop-loss order is designed to...?
- Guarantee profit
- Limit losses
- Add leverage
- Widen spread
✅ Answer: Limit losses
10. A trailing stop does what as price moves favorably?
- Follows price to lock gains
- Stays fixed
- Widens
- Removes the stop
✅ Answer: Follows price to lock gains
11. A reward-to-risk of 3:1 means for each $1 risked you target...?
- $3 reward
- $1 reward
- $0.30 reward
- $10 reward
✅ Answer: $3 reward
12. Position size should be based primarily on...?
- Gut feeling
- Stop distance and risk %
- Round lots
- Max leverage
✅ Answer: Stop distance and risk %