Account Size for trading micro NQ (MNQ) strategy

October 29th, 2019, 08:57 AM

Micro NQ account size question --

I have developed a mechanical / fully automated futures trading strategy that I'm looking to take live in the coming months. It's designed for various futures, and I'm looking to start with testing it out on MNQ trading ONE contract.

The strategy stop loss is set at $50, backtesting shows max 7 consecutive losses. The max intraday drawdown per backtest is $3500, trade close to trade close $500. The strategy holds contracts overnight.

I'm calculating account size like this (again, trading one (1) contract):
Price of instrument: $8100
Margin: $760
Buffer for drawdowns: roughly 2x max intraday drawdown: $7000

Based on this I'm thinking a $15k account would be reasonable.

Is this the right way to think about this?

Thanks for your thoughts!

October 30th, 2019, 12:49 AM

your numbers appear to be off.....a single mnq contract pays .50 a tick...if you had a loss of 50 7 times you are at 350 not 3500.....

October 30th, 2019, 01:19 AM

The drawdown was actually due to forgone profit on a trade that has a high open equity and closed out 3500 less profitable. The downside risk from recurring stopped out trades is still 7x50, $350.

Account Size for trading micro NQ (MNQ) strategy

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Account Size for trading micro NQ (MNQ) strategy