Just to add to this a little (I agree with everything tbs has said), I would also recommend you look at the spread v timeframe you are considering dealing in. The larger the spread as a % of the risk you are prepared to take, the greater the risk in trading that instrument in that timescale.
I personally do not like to trade if the spread is more than 10 to 15% of my prospective stop loss level.
ie a) if spread is 3 and prospective stop level is 30, this is fine as spread is only 10% of stop.
b) however, spread of 5, and stop of 10 (50%) I would consider too risky.
Reasons? makes it much harder to acheive worthwile reward: risk ratio.
In example b above, without taking spread into account, if I wish to acheive r:r of 2:1, my stop is 10 and target is 20.
Taking stop into account, my risk is 15 (10+5) and my target is 15 (20-5) which gives r:r of 1:1 in reality.
Obviously, the lower the % of spread/ stop, the less effect on r:r this has.
If faced with the issue in example b above, either look at another instrument or look at the same instrument, but on a longer timescale.
As an example. SB'ing FTSE with a spread of 4 or 5 on 1 or 5 min charts is probably going to have a large % spread v stop.
However, on a 1 hr or more timescale it may be ok.
For shorter timeframes, have a look at currencies. ie eur/usd and gbp/usd will have acceptable % spread v stop on 10/ 15 min timescales
