Sounds like too much. I use less than half that while day trading and even less for overnight trades; and there are many that would consider the leverage I use to be insanely high. Calculate the percentage of your account that you are risking for each trade. It gives you a better idea of what you are risking and and what kind of devastation you could do to your account with a string of losses or one news shock that gaps against you. One thing I've found helpful when trading with a bit of leverage is to have a maximum percentage of my account that I allow myself to lose in a day (you could do this on a weekly or monthly basis for longer term trades). If I reach this max drawdown I stop trading. This protects myself from occasional bouts of self destructive stupidity.
Chinook's EUR/USD (E/$)Mumblings
- Thread starter chinook
- Start date
Sounds like too much. I use less than half that while day trading and even less for overnight trades; and there are many that would consider the leverage I use to be insanely high. Calculate the percentage of your account that you are risking for each trade. It gives you a better idea of what you are risking and and what kind of devastation you could do to your account with a string of losses or one news shock that gaps against you. One thing I've found helpful when trading with a bit of leverage is to have a maximum percentage of my account that I allow myself to lose in a day (you could do this on a weekly or monthly basis for longer term trades). If I reach this max drawdown I stop trading. This protects myself from occasional bouts of self destructive stupidity.
Thanks. I thought it was high leverage given the intraday swings I had just last week during the short durations I had my positions. I plan to cut it in at least half. I was a bit surprised that a firm would even offer a 400 leverage. Sure sounds better than a casino... if you just can time perfectly the first couple of trades at 400 leverage... and go back to your normal levels
This thread gets a mention in Currency Trader Magazine (pg. 35):
http://www.currencytradermag.com/downloads/CurrencyTrader1204.pdf
http://www.currencytradermag.com/downloads/CurrencyTrader1204.pdf
The link doesn't work.
It works for me. It's a PDF file so you have to have Acrobat Reader installed and it's a big file so if you have a slow connection it will take a while. If you can't get it to work go to www.currencytradermag.com and download the December issue.
Cheers,
TRADERguy
I finalized my ES system testing and went live with 100% automation this morning. As I wrote before for automation, I'm using a text file generated by a Tradestation indicator and feeding it into Bracket Trader. Then the BT sends an OCA order to IB. I'm not trailing my stop anymore so I don't need any manual intervention. And my first trade didn't match what Tradestation strategy generated! The problem is with the strategy generating orders for the next bar and the indicator generating orders intrabar. I turned off intrabar updates for the indicator and now the trades should match better.
I'm still working on the EURUSD system. I have a positive expectancy system which looks good but I'm not comfortable with its drawdown yet. Meanwhile, I'll continue to trade it manually.
I'm still working on the EURUSD system. I have a positive expectancy system which looks good but I'm not comfortable with its drawdown yet. Meanwhile, I'll continue to trade it manually.