If you are only supposed to risk 2-5% of your trading funds per trade, does it then mean the minimum I should save to start trading would be 20 to 50 times whatever the average cost of my position would be? So I want to start trading LEAP options, five contracts at a time.. (approximately 4k per trade). Thus: I need $80k to $200k to consider starting this?
Says who? Some featherweight "guru" who has no earthly clue how to right-size his trades so he takes the wussy way out? http://www.elitetrader.com/vb/showthread.php?t=279599
Ah, I had read some of the older threads about risk management, Kelly criterion, and it seemed like quite a few traders had warned about risking too much of your capital at any given time. Thanks for clarifying!