Position Sizing

Discussion in 'Risk Management' started by peregrinecap, Aug 29, 2012.

  1. ==============
    Yes;
    less is more.
    That is if you plan on being iin business much.LOL:D
     
    #41     Sep 14, 2012
  2. Absolutely absurd.

    Position size is EVERYTHING.

    You MUST risk the same amount on every trade.

    If you don't... all other stats are meaningless.

    Why?

    You can be 90% right on a 1:1 r/r but only be risking $ 100/trade... then you get cocky and decide to risk 10x the amount and lose... after 10 trades you are down $ 100... vs being up $ 800. This was the simple math example. Many an account has been blown due to improper position sizing/risk management.

    Locate an area on the chart where you are proven wrong. Determine your entry. Size accordingly based on the math that equals the risk amount you are willing to lose every time you press the trade trigger.

    As simple as that-- if you have an edge and are looking at 1:2 or more risk to reward setups... you will succeed.
     
    #42     Sep 17, 2012