What is the Maximum Percentage of Risk Capital Should I risk on any one trade ?

Discussion in 'Technical Analysis' started by scott55tt, Jun 3, 2007.

  1. Hi,

    I need help on money management technique.

    What percentage of my total risk capital should I risk on any one trade to survive and come back to trade next day for some time assuming my system is right 50% of the time?


    Any other money management suggestions also highly appreciated.

  2. fubar


  3. It depends on your appetite for risk. Greater risk means greater volatility and likely greater draw downs. What is best for you might not be best for me.

    I choose a risk level that lets me sleep at night. For me that value is 2 %.

    I model portfolios with portfolio analyzer software to learn the relationship between growth rate and risk. Simulation results are attached.

    Increasing your choice of risk level can show record breaking performance

    <img src=http://www.internetweekly.org/images/thomas_hot_dog.jpg \img>

    but you might not be comfortable with the results.