I watched some youtube video, which advocates: "keeping risk constant and increasing the exposure"
i.e always keep the max loss on account per trade small (say 1-2%) but feel free to increase your position size if you are winning (
pyramiding) just make sure to adjust your stop loss levels to manage your risk down to 1-2% levels.
What you guys think about this? I feel keeping the
contract size small and not pyramiding will eventually outperform such 'const risk + pyramiding' scheme. This conclusion of mine is through intuition from nature. Size of animal matters and smaller the size higher the chance of survival against harsher environments, so if there is a nuclear holocaust we can be quite assured some kind of bacterias and microbes will survive and the bigger sized animals will be wiped out first.
There is another diametrically opposite way to see pyramiding: "you gotta press your winners, outliers are where the money is"
I don't know how to test my conclusions, so am asking here. What you guys think? How to make sense of these two diametrically opposite views!?
Thanks,
Rocktrader
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Edit: Adding some interesting trivia
Allometry is the study of animal size
Some kind of bacteria are known to stay alive in radioactive environments repairing their own DNA which gets knocked down by radiation!
Deinococcus radiodurans is the name of that bad ass bacteria!