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What % of your capital do you allocate to each position?


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What % of your capital do you allocate to each position?

  #11 (permalink)
Surprise
Amman/Jordan
 
Posts: 39 since May 2013
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Thxo View Post
At first, i want to say something like this;

Trader = Risk Taker, nothing wrong with just 1-2% / trade.
Too much consecutive losses => back to drawing board.

but, reality is not that simple ;

Win%------Probable losing streak

30%----------30
35%----------25
40%----------21
45%----------18
50%----------16
60%----------12
70%---------- 9
80%---------- 7
90%---------- 5



PS. By extreme : I meant risky .

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  #12 (permalink)
Thxo
West Java
 
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Thxo View Post

Win%------Probable losing streak

30%----------30
35%----------25
40%----------21
45%----------18
50%----------16
60%----------12
70%---------- 9
80%---------- 7
90%---------- 5




If you have 90% win rate, make sure you can withstand (mentally and financially) the potential of 5 losing streak.
etc.


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  #13 (permalink)
 
Fadi's Avatar
 Fadi 
Luxembourg
 
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Surprise View Post
Risking 1-2% per trade - short term trading - is a bit extreme and one of the main reasons why traders lose , few consecutive losses and you are in a handsome DD , its not clear where these figures came from !

To trade well, I recommend in this case that you divert completely from trading for a while and learn how to run a Casino business first Then come back to trade, and apply what you've learnt on statistics, probabilities, expectancies, etc...

Proper money management is the more important part of this business than any technical abilities you might develop.

Successful people will do what unsuccessful people won't or can't do!
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  #14 (permalink)
Surprise
Amman/Jordan
 
Posts: 39 since May 2013
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Fadi View Post
To trade well, I recommend in this case that you divert completely from trading for a while and learn how to run a Casino business first Then come back to trade, and apply what you've learnt on statistics, probabilities, expectancies, etc...

Proper money management is the more important part of this business than any technical abilities you might develop.

Thats exactly my advice , 1-2% is just an arbitrary number , and its a risky proposition for short term traders , it simply wont/doesn't work for most ...

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  #15 (permalink)
 
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 shodson 
OC, California, USA
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Fadi View Post
To trade well, I recommend in this case that you divert completely from trading for a while and learn how to run a Casino business first Then come back to trade, and apply what you've learnt on statistics, probabilities, expectancies, etc...

Proper money management is the more important part of this business than any technical abilities you might develop.

Great book ==> Trade Like a Casino


Follow me on Twitter Visit my NexusFi Trade Journal Reply With Quote
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  #16 (permalink)
 
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 Big Mike 
Manta, Ecuador
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shodson View Post
Great book ==> Trade Like a Casino


You might check out the nexusfi.com (formerly BMT) webinar with him:



Mike

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  #17 (permalink)
 
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 Fadi 
Luxembourg
 
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Big Mike View Post
You might check out the nexusfi.com (formerly BMT) webinar with him:



Mike


Love this webinar

Successful people will do what unsuccessful people won't or can't do!
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Last Updated on April 19, 2014


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