What's your maximum allocation to a single stock, sector, or market?

Discussion in 'Risk Management' started by Ghost of Cutten, May 31, 2011.

  1. tradermn

    tradermn

    I don't think the correct question is how much do you allocate as much as it is how much do you risk.

    I might ALLOCATE 100% of my capital to a trade but only have a defined risk of 1% of my capital. Maybe that is your question...

    I allow every trade to lose 2.2% of my total capital. Of course most my trades aren't losers (or I wouldn't have any capital left). And you shouldn't discuss risk without discussing reward. For example, I allow my reward to reach as high as 3.8% of my capital.
     
    #11     Jun 9, 2011
  2. .5% risk for intraday trades

    2% risk for a daily/weekly swing trade.
     
    #12     Jun 9, 2011