Sizing

excrypto · Jun 29, 2025 at 1:29 PM

wxytrader said:
"This makes sense if you're using hard stops — but I don’t use them. So fixed % risk per trade kind of breaks down in that context. For non-stop strategies, I size based on volatility, beta exposure, or simple dollar allocation. The key is knowing your max portfolio drawdown tolerance rather than per-trade losses."

Tight stops = strict risk control
✅ Limits downside
❌ Chopped out often (“death by a thousand cuts”)
❌ Miss big moves
❌ Emotional fatigue

Solution:
– Use wider stops + smaller size
– Mental stops / hedging / options
– Structure-based exits over strict price stops

Fixed % risk per trade:
✔ Keeps risk consistent
❌ Uneven capital per trade

Fixed $ allocation (e.g. 4x $2.5K in $10K):
✔ Spreads capital
❌ Risk per trade varies if stop distance differs

Many combine both: risk % + diversified capital to stay sized right without overexposing.
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Then dont respond if youre unlike most traders and dont use hard stops. like i dont get why you keep responding when the universe isn't talking to you? Do you also wake up and try and find your nearest homeless person to tell them you overcooked your breakfast eggs?

I literally am not gonna read the rest of your message...

wxytrader · Jun 29, 2025 at 1:45 PM

excrypto said:
Then dont respond if youre unlike most traders and dont use hard stops. like i dont get why you keep responding when the universe isn't talking to you? Do you also wake up and try and find your nearest homeless person to tell them you overcooked your breakfast eggs?

I literally am not gonna read the rest of your message...
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Actually that was chatgpt giving you a lesson on how counter intuitive stops are lol.

newwurldmn · Jun 30, 2025 at 1:20 AM

excrypto said:
Question about this forum post. (https://tradethatswing.com/how-much-stock-to-buy-how-to-position-size-when-swing-trading-stocks/)

If I use the first position sizing technique (fixed %) on a $10,000 account and risk 1% on a $15 stock and stop at $14.25 then I can only take 133 shares.

If I use the same numbers for the fixed $ technique using the same stop (5%) with 4 stocks in the $10,000 portfolio each getting $2500 then I get 166 shares per stock and it coming to $125 risk. Which is above my 1%. So I ask why not just use the fixed % technique in the first place so I dont oversize and have to worry about that?
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you can. There isn’t a perfect answer.

To make it apples to apples. You have 4 stocks you want to buy. You will invest a total of 8k in the first scenario and 10k in the second.

You will likely make less money in the first scenario than the second. that’s the different deaddog was talking about.

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Sizing

excrypto

wxytrader

newwurldmn