Probability based Trade Management Concepts

Discussion in 'Risk Management' started by virtualmoney, Jun 15, 2009.

  1. Does your directional method based on whatever indicator(s) have > 8 losses in a row? If you bet it will not, then perhaps you can use this approach to position size each consecutive independent trade (which is less aggressive than martingale with the first winning trade covering the losses of all earlier trades and ending with a profit):

    user input=X lots, e.g 0.01 ; Y pips, e.g Y=15

    Stop Loss____Profit Target________No. of lots


    Came across an interesting probability (expectancy) based System here:

    Please share ideas to further improve upon them.:)
    and discuss more about Probability based Trade Management Concepts...
  2. This table is confusing to me. Why don't you give a simple example with actual numbers for us to get an idea of the method. Ay first glance it looks like gambler's fallacy. For how long are you going to be increasing position size? At some point you get a margin call.
  3. I think it's hard for anyone to know the expectancy of a trading system or trade management structure until they have PERSONALLY traded it...

    I can show someone my high probability system, but if they haven't put in the screen time or don't have the proper training, they'll kill a great system...

    "no short-cuts"