Position Size 4 DAY TRADERS

[OddTrader]

Quote from FredBloggs:


then i start to investigate how TODAYS big successful DAY traders go about their business. (harris brumfield, paul rotter etc) NONE of these guys seem to advocate such small %. they seem to take the approach that if they are right, they want to be right in a big way. large traders i know personally also have a similar approach. suggest to them only risking 2% and see how hard they larff!!

It would be very interesting to see any hard data and their sources for the above study.

Quote from FredBloggs:

im sure we are all aware of the 'classical' trading texts. they all seem to have this concept of risk management & position sizing theories of only risking 2% of the account.

According to the data in Soros' Alchemy of Finance, it seems to me, as my calculations based on estimated daily volatility might be wrong, roughly he did apply the 2% rule on each market of his investment/ speculation portfolio, probably for diversification purpose.

 

[BloodTrader]

Quote from FredBloggs:

im really not trying to boast here, but typically, only 20% of my trades lose money (BUT ONLY) if im on top of my self. (self empathy and market empathy are probably equal in my success in any day/week)

That's kind of funny...

NONE of my trades lose money, ever....except when I'm not on top of my game, blah blah blah

m

 

[spreadem]

Less than half percent ...

Less than 0.5 percent would be $100 per $20,000. You'd have a cushion if (or when) you have a losing streak.

Always, always protect your capital. Risking half a percent will allow you to stay around to see if your trading system really works.