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Trading 1 contract vs multiple contracts is...
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Trading 1 contract vs multiple contracts is...

  #1 (permalink)
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Trading 1 contract vs multiple contracts is...

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Trading 1 contract vs multiple

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  #3 (permalink)
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easy...


The answer is - 1 contract to trade is HARDER

because there is no chance for
a) scaling in or
b) scaling out

As long as you are trading without any scaling(s) in/out there is NO difference of course.

GFIs1

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i think it actually is a psychological aspect of trading. Based on my coin flip studies all in - all out vs scale out, over a large sample size (40k+ samples) all in all out wins out mathematically. So technically multiple contracts and 1 lot should be the same using the optimal trade management scheme of AIAO fixed stops and targets. However scaling out is suboptimal, it is good for the traders psychology, this is IMHO the only reason I can see to use a suboptimal management strategy. In which case then multiple lots becomes easier. So it comes down to 1 real question that every trader has to ask themselves.

Do I want the mathematically optimal solution or the psychologically optimal solution? Which is more important to me?

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treydog999 View Post
i think it actually is a psychological aspect of trading. Based on my coin flip studies all in - all out vs scale out, over a large sample size (40k+ samples) all in all out wins out mathematically. So technically multiple contracts and 1 lot should be the same using the optimal trade management scheme of AIAO fixed stops and targets. However scaling out is suboptimal, it is good for the traders psychology, this is IMHO the only reason I can see to use a suboptimal management strategy. In which case then multiple lots becomes easier. So it comes down to 1 real question that every trader has to ask themselves.

Do I want the mathematically optimal solution or the psychologically optimal solution? Which is more important to me?

How did you proceed with your coin flip experiement. What was the risk/reward? The good point in favor of scaling out is that you can be more risky or take sub optimal setup and still be a winner over time while using an AIAO approach you need to be more selective. As a corrolary should we ever move our stop loss to BE or should we wait for either our stop loss or target to be hit and never touch them once in a trade?

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trendisyourfriend View Post
How did you proceed with your coin flip experiement. What was the risk/reward? The good point in favor of scaling out is that you can be more risky or take sub optimal setup and still be a winner over time while using an AIAO approach you need to be more selective. As a corrolary should we ever move our stop loss to BE or should we wait for either our stop loss or target to be hit and never touch them once in a trade?


Here is the link to the post I am referring to:

https://futures.io/psychology-money-management/19803-coin-toss-experiment-strategy-4.html#post321074

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Because I have proven to myself that trading AIAO is more profitable over the long term, there isn't any real technical difference between 1 contract and multiples.

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define hard

trading is not easy period, if it was 95% would be successful

I think it therefore boils down to you and your plan

do you/can you trade all in all out, or do you/can you trade using a scale based plan

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a couple thoughts come to mind....

if a trader is trading all in and all out, it doesn't matter how many contracts you trade, b/c that suits your style..

if a trader scales out positions....then obviously its not going to work in favor of 1 contract traders

if a trader scales in positions.....same as above...

...but this rings in another question.


What is better? do ppl think that say trading 3 contracts (or units) is better than 1 because you can ride a trend and lock in profits?

for someone just starting...is it better to just trade 1 contract to limit losses?

I've been thinking about this recently....I remember a trader mentioning that at his place of work trading CL, they're not allowed to trade 2 contracts until they make $10,000 in a month trading only 1 contract....whether true or not....it can be done...

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