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How to increase profit without increasing size?
- Thread starter innovest_11
- Start date
What securities are you trading?
What instruments you using to trade them?
What's your strategy & game-plan?
There are many, many ways to tip the balance between losses and winners. You may not be able to change the odds, such as the likelihood of something going up or going down, but you CAN change how much you lose versus win when that even occurs.
For example, let's say XYZ goes up 5% today. Trader1 can gain 5% on that move, Trader2 can lose 5% on that move and Trader3 can win 50% on that exact same move. The results will vary depending upon what instruments you use and your strategies.
What instruments you using to trade them?
What's your strategy & game-plan?
There are many, many ways to tip the balance between losses and winners. You may not be able to change the odds, such as the likelihood of something going up or going down, but you CAN change how much you lose versus win when that even occurs.
For example, let's say XYZ goes up 5% today. Trader1 can gain 5% on that move, Trader2 can lose 5% on that move and Trader3 can win 50% on that exact same move. The results will vary depending upon what instruments you use and your strategies.
Profit is easily increased if one were to run it. Size is of secondary importance. If the size is correctly made in the first place, then the size should never be a further consideration.
You can back test this idea to see if it will increase profits while decreasing risk, since it is going to decrease risk, add more stocks or lots to get risk back to what you normally risk overall. Put on 65% at normal entry, then 25% at so much better price and last 10% and even better price. Your back testing should be able to tell you what the "mean" drawdown is on each trade winning trades to know where you should get in better. So even on breakeven trades based on getting out of all at original price, you would make something on the add-on trades.