% Volatility Position Sizing model...

Discussion in 'Trading' started by Trend Fader, Mar 31, 2003.

  1. Anyone here position or swing trade using Van Tharp's percentage volatility position sizing model....

    What do you think are the benefits of using such a type of position sizing strategy over the percentage risk model?

  2. THe best feature I can think of regarding the % volatility model is..

    If you are using very tight stops.. like a %1 stop...then the volatility % model wont necessarily allocate all you funds to one position... because the % risk model would allocate all funds to one position if the actual stop loss is %1.

    Although we want to maximize position size as much as possible... in reality allocating entire portfolio to one position is suicide for swing traders..