How much volatility is acceptable in your opinion?

Discussion in 'Crypto Assets' started by Cuddles, Jun 7, 2017.

  1. Cuddles

    Cuddles

    Looking at BTC seems like -15% is when I should start worrying... makes me more nervous than usual. Talking about established coins here, the alt-coins are all over the place.

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  2. panganp

    panganp

    Whenever possible a trader should adjust the size of the bet by volatility. If doing so is possible, then volatility should be irrelevant for a trader - just need to place a smaller bet, perfectly doable with bitcoin. Have not traded bitcoin derivatives, so not sure on that arena, but for unlevered BTC trading this should be a non-issue. Whole different ballgame for those who use bitcoin as means of payment.
     
    wintergasp likes this.
  3. I love euro...because it's the only currency that moves within a boundary; GBP is just crazy. Not to mention Canadian dollar - its movement is driven by random walk lol
     
  4. Simples

    Simples

    50% down on a position is my line in the sand. More than that, and losses may be accellerating rendering the position meaningless, though some stocks recover from that as well with good margin. It is good to use tricks to reduce drawdowns further of course, so this is just one of many factors to account for and not a major one at that, since it's detached from historical PA. Most other SL will kick in way before this one.

    I see 0.5% and below as noise/spread, while 1-2% start to becoming movements with some meaning.

    Of course, depends on timeframe, market, leverage, and strategy, but this is typical for long-term stocks in my experience.
     
  5. birzos

    birzos

    The comments are funny, reduce sizing, how retail, no you use smaller timeframes with their own dynamics, makes life more interesting.
     
    Simples likes this.
  6. Volatility really does not matter if your position size is properly calculated.