Your daily loss limit should size the trade, not your convictionEthereum / TetherUS PERPETUAL CONTRACTBINANCE:ETHUSDT.PQATS_PropMost prop evaluations end on one bad day, not on a slow month. So the order of decisions matters: the daily room comes first, the position size second, the setup last. On this ETH 4h chart the planned long is at 2,456 with a stop at 2,412, about 1.8% below entry, and a target at 2,560. The arithmetic for a $50,000 evaluation with a 4% daily loss limit: 1. Daily loss limit: $2,000. 2. Personal daily stop at half of it: $1,000. You stop before the rule does. 3. Risk per trade at a quarter of the personal stop: $250. 4. Size = $250 / (stop distance + fees), about 5.5 ETH or roughly $13,600 of position value. One stop-out uses 12.5% of the day's limit, eight of them fit before a breach, and the target pays about 2.4R. Now change only the conviction. Doubling the size because the setup looks great turns one stop-out into 25% of the daily limit and cuts the losses you can absorb from eight to four. Nothing on the chart changed, only the risk. Size from the stop distance and the daily room you have left, then decide whether the setup is worth taking. The panel on the chart is our free open-source QATS Prop Challenge Risk Panel: click any entry and stop and it shows this math. Educational example, not a trade recommendation.