That's precisely the point. Why is there a belief that past candle patterns will govern the future behaviour of the bank taking the other side of your bet ? If the bank cannot be controlled that way, what use is testing against the past candles ? A useful testing will necessarily involve real money.
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1% risk clarification
- Thread starter packer43064
- Start date
That's precisely the point. Why is there a belief that past candle patterns will govern the future behaviour of the bank taking the other side of your bet ? If the bank cannot be controlled that way, what use is testing against the past candles ? A useful testing will necessarily involve real money.
That's precisely the point. Why is there a belief that past candle patterns will govern the future behaviour of the bank taking the other side of your bet ? If the bank cannot be controlled that way, what use is testing against the past candles ? A useful testing will necessarily involve real money.
There's not a successful hedge fund out there that doesn't rigorously test their strategies before putting real money to work. They all hire PhDs in math, engineering, physics, etc, to do that for them, and they pay them big money to do it.
There's not a successful hedge fund out there that doesn't rigorously test their strategies before putting real money to work. They all hire PhDs in math, engineering, physics, etc, to do that for them, and they pay them big money to do it.
Is there data suggesting hedge funds have proven past candles can control future actions of banks ? Yes, the banks take the other side of hedge funds also.
hedge funds are not trying to control future actions of banks, just trying to make money for their clients and themselves. The banks also hire the PhDs to test strategies. Some work, some don't. Some work for a while, then stop working, and the game continues.
hedge funds are not trying to control future actions of banks, just trying to make money for their clients and themselves. The banks also hire the PhDs to test strategies. Some work, some don't. Some work for a while, then stop working, and the game continues.
Quite obviously the banks strategy works better, they have more tall shining building than hedge funds. If you want to make money, is it not better to copy the banks than the hedge funds ?
The banks are also much older and have far more employees, therefore they need those big buildings. How much is the wealthiest employee at the bank making compared to the wealthiest hedge fund CEO?
The banks are also much older and have far more employees, therefore they need those big buildings. How much is the wealthiest employee at the bank making compared to the wealthiest hedge fund CEO?
As I recall, many of those big banks also required a bailout a few years ago.
With only $5,000 to trade, you have no business trading.
The amount one should risk per trade is dependent upon a few factors:
1. The expectation per trade of the strategy being traded
2. The desired rate of return
3. The trader's tolerance for risk
The only way to really figure out how much to risk is to do some rigorous testing of the strategy you intend to implement. You need to find out what percentage of winners you will likely have, the ratio of dollars per win to dollars per loss, the average losing streak and the worst losing streak.
Once you you can figure this out, you can crank up the numbers to see how much of a drawdown will go with the desired rate of return. For instance, can you tolerate a 50% worst drawdown in exchange for a 25% compound annual return? The typical trend following commodity trading advisor is willing to accept that type of ratio.
The 1-2% rule is a typical risk per trade suggested by some people familiar with the Turtle trading system in the futures markets. That level of risk was reasonable back in the 1980's when the system was originally taught, but not generally applicable now since the system has deteriorated. Many people who don't really know much about trading then just spout off that rule because they heard it from someone else.
Thank you. So it would make sense to save up more money and just back test with fake money (simulated trades)? I'm doing this now, I just wanted to understand how much to risk per trade.
How much money you think you need to start out with to swing trade?
I don't expect to make millions like Joe thinks everyone does. I'm willing to put in the effort and if I fail so be it. Nothing in life is easy.
After rigorous testing, the OP is likely to have 500 left from the 5000. At that point, going all in with 100% risk is the probably the best option. Unless of course people believe past candle patterns will repeat because the bank on the other side of the retail trade will in some way be magically compelled by those candle patterns to lose their money. Or perhaps the belief is: bank, what bank ? I don't need no stinking bank, I have liquidity provider.
Do you have to start bickering in every thread you post in? Troll much?
Is it possible people are willing to put in the effort and actually make something of themselves? The best athletes, doctors, directors, and traders put in a lot of hard work to become who they are today.
Did you fail? Maybe you didn't have it in you to become a profitable trader. Get over it and learn and stop with this "it is impossible" attitude. People do the impossible everyday.
Thank you. So it would make sense to save up more money and just back test with fake money (simulated trades)? I'm doing this now, I just wanted to understand how much to risk per trade.
How much money you think you need to start out with to swing trade?
I don't expect to make millions like Joe thinks everyone does. I'm willing to put in the effort and if I fail so be it. Nothing in life is easy.
You can start with $5,000, but you'll have to stick with stocks or ETFs. If you can only trade 50 or 100 shares, so be it. Don't be in a hurry to grow rich starting with so little...it just won't happen unless you risk too much and get lucky.
Keep this in mind, you don't have to trade everyday or even every week. Do some good research, find some really good setups, and just sit tight until they come along. That's the easy part. The hard part will be when you are in the trade. You'll need to come up with some good strategies for exiting.
If you have some decent success, then maybe you can pool your money with some friends and family, and make some money that way as well.
It's a marathon, not a sprint.