FOREX Charts at Glance July 5, 2007
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- Thread starter miniFORTUNE
- Start date
Hi mF, I just stumbled on your thread which I find very interesting. I have a question regarding suggested leverage - I understand that you do not give any trading advice.
If one wants to keep the leverage to 3:1 (total exposure to account value) and assumes that your system on average has 6 open positions, would one divide the account value by 6 and allocate three sixth of the account value to each currency pair or would that result in a leverage of only 1.5:1 because of the offsetting long and short positions of the USD?
What would you consider a prudent leverage for your system?
Thanks
If one wants to keep the leverage to 3:1 (total exposure to account value) and assumes that your system on average has 6 open positions, would one divide the account value by 6 and allocate three sixth of the account value to each currency pair or would that result in a leverage of only 1.5:1 because of the offsetting long and short positions of the USD?
What would you consider a prudent leverage for your system?
Thanks
quote from kahai
Hi mF, I just stumbled on your thread which I find very interesting. I have a question regarding suggested leverage - I understand that you do not give any trading advice.
If one wants to keep the leverage to 3:1 (total exposure to account value) and assumes that your system on average has 6 open positions, would one divide the account value by 6 and allocate three sixth of the account value to each currency pair or would that result in a leverage of only 1.5:1 because of the offsetting long and short positions of the USD?
What would you consider a prudent leverage for your system?
Thanks
_______________
Hi!
Good question, but above my head. I'm fairly new to FOREX. Maybe some expert here at ET could give you a better answer. Your allocation for six pairs sounds prudent. Personally, so far I carry four or less positions with half the capital uncommitted. And it balances. For example last night while sleeping the USDJPY took my 100 pips stop but was more than offset by the rise on the Euro and the pound.
Take care, kahai!
mF
Hi mF, I just stumbled on your thread which I find very interesting. I have a question regarding suggested leverage - I understand that you do not give any trading advice.
If one wants to keep the leverage to 3:1 (total exposure to account value) and assumes that your system on average has 6 open positions, would one divide the account value by 6 and allocate three sixth of the account value to each currency pair or would that result in a leverage of only 1.5:1 because of the offsetting long and short positions of the USD?
What would you consider a prudent leverage for your system?
Thanks
_______________
Hi!
Good question, but above my head. I'm fairly new to FOREX. Maybe some expert here at ET could give you a better answer. Your allocation for six pairs sounds prudent. Personally, so far I carry four or less positions with half the capital uncommitted. And it balances. For example last night while sleeping the USDJPY took my 100 pips stop but was more than offset by the rise on the Euro and the pound.
Take care, kahai!
mF
mF, I entered the positions as you posted them day before yesterday, except I left the USD/JPY Long - I am going more for the long term trend - and set the stop at 300 pips, and today I am up 586 pips - it was just lucky timing.
I am conservative in my leverage, I entered each position at the dollar equivalent of 1/2 of my account value so I will have maximum leverage of 3:1, assuming an average of 6 open positions. Since I am using Oanda, where I can trade single currency units, I can fine tune the leverage precisely. The pip gain in my account translates to an approximate gain of 1.5% of my account value in 2 days - wish it could go on like this.
I am conservative in my leverage, I entered each position at the dollar equivalent of 1/2 of my account value so I will have maximum leverage of 3:1, assuming an average of 6 open positions. Since I am using Oanda, where I can trade single currency units, I can fine tune the leverage precisely. The pip gain in my account translates to an approximate gain of 1.5% of my account value in 2 days - wish it could go on like this.