Number of contracts

[trader1974]

How do you determine the number of contracts when opening a trade?
-Based on the probability of success?
-Based on the time of day?
-Based on that you have lost and need to increase the size to recover?
-If it is in your favor, add? for example 3 then 2 then 1?
-If it goes against you, open 1, then 2, then 3? Knowing at all times with how many contracts I am going to operate is an art because the market is constantly changing.
The situation you find yourself in (whether you win or lose) also influences the psychology.
I usually start small and if I'm unlucky I sometimes double or triple the positions.
There are many possible combinations.
Which one do you like?
What approach has worked best for you?

 

[maxinger]

Enter trade with say standard size of 3 micros.

If confidence is low (eg the market has been rather choopy / erratic),

or if the trade is considered as higher risk (eg if you have missed a signal),
enter with just 1 micro.

These statements
' I usually start small and if I'm unlucky I sometimes double or triple the positions. '
' Based on that you have lost and need to increase the size to recover? '
sound strange / dangerous.

 

[trader1974]

Based on that you have lost and need to increase the size to recover? '
sound strange / dangerous

Yes, I know it's a bit strange, it helps me have more winning days, the problem is that when I lose, then I lose big because I'm looking at other ways to do it It is like roulette.
If you bet 1 on white, if it does not come 2 on white, if it does not come 4 on white then almost always win but this ends badly in the end.
Roulette has a 50/50 chance of winning or losing but in trading as the chances can be 60/40, 70/30, 40/60 then it is more complicated.
I think it is better to base the number of contracts on a probability factor.
It is complex.
I like your approach.
3 micros allows you to partially close the position.
If it goes well, you can let a winner run.
Thanks Maxinger

 

[maxinger]

Yes, I know it's a bit strange, it helps me have more winning days, the problem is that when I lose, then I lose big because I'm looking at other ways to do it It is like roulette.
If you bet 1 on white, if it does not come 2 on white, if it does not come 4 on white then almost always win but this ends badly in the end.
Roulette has a 50/50 chance of winning or losing but in trading as the chances can be 60/40, 70/30, 40/60 then it is more complicated.
I think it is better to base the number of contracts on a probability factor.
It is complex.
I like your approach.
3 micros allows you to partially close the position.
If it goes well, you can let a winner run.
Thanks Maxinger

Right.
There is absolutely no way to predict how far the market will move.

so the first micro, you target reward risk ratio of say 2:1.

The third micro, you hold the position for many many hours.

Sometimes, the market is not kind to us and all 3 micros suffer losses.
Just make sure you have a stop trading limit per day
(eg max loss of $200 per day). Once this limit is hit, no more trading
for that day.

 

[trader1974]

Just great
You are big Maxinger
I just hope one day to be as good as you

 

[murray t turtle]

How do you determine the number of contracts when opening a trade?
-Based on the probability of success?
-Based on the time of day?
-Based on that you have lost and need to increase the size to recover?
===============================================
The situation you find yourself in (whether you win or lose) also influences the psychology.
I usually start small and if I'm unlucky I sometimes double or triple the positions.
There are many possible combinations.
Which one do you like?
What approach has worked best for you?

%%
Plenty of ways to make money in market;
but adding on contracts because of a loss + need to increase size /recovery is the best way to lose + lose big=====================================================Mainly because account equity trends also. IF that worked/then get rich quick would work+ we would all be billionaires.
I like to cut back when losing-usually it means the med or long term trend has changed. Good question1974/2009.

 

[ctheo1]

These are the inputs you need:

• Big point value = e.g for ES $50
• % equity at risk - what % of your equity you want to risk; let's say 1% ($1,000) i.e. you're trading a 100k account
• your entry point - stop point = let's say this is 10 ES points (entry 3300, stop 3290)
• your $ volatility for 1 contract = 10 * 50 = $500
• You can therefore trade 2 contracts (1000/500)