Registered: Feb 2008
09-27-10 02:35 PM
Quote from LeeD:
Do you consider money management (a part of) your trading edge?
If your win rate and your profit factor do not result in a positive expectation then money management alone can do nothing to change that. However, certain forms of money management can affect the expectation. Inappropriate money managament can also cause ruin regardless of positive expectation. Thus, effective trading needs both, first a positive expectation and then good money management. Each is necessary but not sufficient. Both together are sufficient for consistent returns.