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Maximum risk percentage

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Market Wizard
Boca Raton
Trading Experience: Advanced
Platform: Variety
Broker/Data: Optimus Futures, LLC
Favorite Futures: Futures
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Posts: 2,410 since Sep 2010
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reno57540 View Post
This is exactly how I am feeling about the situation, and I couldn't have described it better.

I know my risk of ruin at 2% per trade is virtually inexistent (I hold trades overnight but never over the weekend), so it is probably extremely low at 4%. Additional I am talking about risk capital only, losing it all would only affect my ego and self confidence, and I could come up with more $ if I had to.

However, how am I going to feel if/when I am down 30%+. Am I going to be able to keep trading the same way?

This is really the only think keeping me from increasing my position at the moment.

Traders ask me the same question that you posted a lot, and my answer is always focused on their psychology. Can they handle the more significant drawdowns?

I find that any transition you do has to be somewhat gradual, so in your case, where you have enough risk capital, open an additional account and trade $25K per one contract. Trade that for six months, and that experience would be more insightful than any advice given. You conquered a winning method, and that is an achievement. Please don't rush to become another statistic because it's better to keep the pace that you are on and win than rush know the rest. You have been there before.

Matt Z
Optimus Futures

There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.

PM with any questions about optimusfutures (800) 771-6748 (561) 367 8686. THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES TRADING.
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