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Even for non-leveraged methods I would disagree about investing your nest egg in anything that you don't have an edge in.
An exception could be you have a good reason to feel it will go much higher, have chart confirmation, set protective stop losses and know it will be reasonably liquid.
"Be right and sit tight." - Jesse Livermore
Can you help answer these questions from other members on NexusFi?
doubt you have $100K... specially if you are really trading 200 cars a pop... risk management @ the FCM would be taking you at of the trades all the time if you are trying to swing that line at first sign of going against you ... second, if you really are doing it, good luck to you, all my best .. I hope you have more to replenish the account down the road... trading rule #1 is protect your capital.. regardless of whatever edge one might have... if I had about $1MM I would swing that line... otherwise, plain stupid to swing 200 cars with $100K...
A fully leveraged beginner who is asking the most important question imo (and many others) is ridiculous. If you have 100k and actually learned to trade you would have a great place to start from. Also, why don't you hit the Caps lock again.
I agree completely that you should be seeking to preserve account funds. Smaller trades with consistent strategies are preferable to piling on 200 contracts at a time, especially when you still have to ask the kinds of questions that the OP was asking.
I work with several systems that do this automatically. They are black boxes. One was up70% last year.
As for my personal charting method, I seek to enter only on very specific, high probability set ups, and then exit as soon as that set up starts to dissolve. I set my stops way outside the most recent level of support and resistance, and prefer to exit if my set up does not hold, before I get drawn down too much.
My way is kind of like trading without stops at all, as I use my stop as an emergency exit if something unforeseen happens; like I have a stroke and almost die, so I can't exit because I awake up in the ambulance.
Obviously it takes a lot of discipline and experience to do this, and a fresh mindset too, so I do not recommend it to newer traders. However, this was my solution to keeping stops as close as possible, but still far enough to breath if need be.
*I* can see if a set up is dissolving or not, and decide if an exit is warranted, or if I should just hang on. A stop loss order cannot...it ONLY sees if a price is hit or not. Thats why I do it this way. I have never been good with figuring just the *Right* stop placement, as they don't really move well with the changing conditions of the markets. They are hard points of exit.
I know that does not help you, but I thought I would share my perspective. I do not recommend doing this for most people, especially if you suffer form emotional involvement.
As for money management, I seek methods and set ups that win 70% or more of the time, and I will at most play 1/3 of my funds at once, ONLY if I am using a super high percentage set up. However, most of the time I SEEK LIMIT MY ENTRIES TO 10% OF MY FUNDS or less.
Now, there are other ways of looking at this. One of the black boxes I am familiar with has seen maximum drawdowns of $4100 and some change during the 6 years of back testing. Since that is the most it ever drew down during that testing, the minimum to participate in it is 5K. I would not be comfortable with that myself, and would feel better with 15K, but it shows another perspective.
You are going to have to evaluate your trading methods, and risk tolerance to figure it out. None of us can really advise you completely, as my advise is based on MY situation, not yours.
