Position Sizing for e-mini contracts

Quote from osorico:

...Other than that, each and every trade must stand on it's own. With it's own set of risk management. Every trade is entered into based on a unique set of MOMENTARY data. Use of generic stops is lazy risk/money management at best...

Osorico :)
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Excellent trading advice.

Simply, to treat each trading day the same or each trade the same with the same risk management, same position size et cetera is like saying the market is the same every trading day.

The market is not the same every trading day.

Therefore, to trade the market each day with the same fixed generic trade managment is problematic.

Mark
 
Quote from notouch:

I totally agree with Osorico. Your stops should be based on a market reference point (or preferably some way below it so you don't get shaken out) not on the amount of risk you're willing to take. If risk is an issue then you need to decrease the size of your position, not tighten your stop. Apart from that the only thing that really matters is that you have enough money in your account so that you don't get a margin call before your stop has been hit.
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I agree 100% too. The market determines where the stop needs to be, not what we're willing to risk or what our pain thresholds happen to be.

This has nothing to do with account size either. If you want to employ something like the much ballyhooed 1% rule, it needs to be based on risk capital available. All account size does is provide the necessary margin for the markets you want to trade simultaneously.
 
Right now, 1 per every $15,000 of capital. I'm ultra conservative.

Geoff

Quote from MGB:

What's your simple rule of thumb for position sizing in regarding to trading e-mini contracts?

For example, 1 S&P e-mini contract for every $5,000 in buying power?
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MGB , a lot of the responses you have gotten are for day trading,, is this what you do? if you plan on position and swing trading then you need much more than $5000 account.
Good risk management is not risk more than 1 or 2% on a trade so you maybee need to analyze your style and each trade independently,, for example in a volatile market like we have right now a fixed 2 point stop is going to hurt your odds of success, so if you decide beforehand on a trade that 20 points is your stop loss (maybe below an important s/r level) then thats about $1000 risk per contract meaning that you would need between $50k -$100k to trade this. Obviously adjust your % risk as to what you feel you can tolerate, but remember you want to stay in the game a long time.
best wishes
 
2-3 k per contract is fine, if your only day trading, imo. you have to define risk parameters, no matter how much capital per contract, small losses, thats all. its a smart way to trade . big money, does not take the place of self-control in using knowledge and discipline which is the key to survival..
 
Good gracious. I must be very conservative then. I like to have a much bigger buffer.

CajunSniper / Puretick.com Administrator-Trader

Quote from scorpion:

2-3 k per contract is fine, if your only day trading, imo. you have to define risk parameters, no matter how much capital per contract, small losses, thats all. its a smart way to trade . big money, does not take the place of self-control in using knowledge and discipline which is the key to survival..
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Quote from osorico:

Using an example 10K account, this calc allows max size of 6 simultaneously open contracts INTRADAY.
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way too much leverage

dunno how long you been trading but you'll be gone soon on that
 
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