Risk Management - Mini Sized Dow

Quote from OTCkrak:

dont trade YM -just because the tick value is $5 while ES is $12.5
More...

I hear what you're saying, but the ES is notoriously hard to trade.
 
Huh? the Dow and SP500 are largely correlated so they are the same difficulty to trade. Yes, I know they don't move the SAME, but they are very close. They are certainly not different enough for one to be easier to "trade" than the other.

The ES is so incredibly popular that, if anything, it would be the easier one to trade.

Also, I disagree with an above poster about never letting a winner trade turn in to a loser. As many times as you take an early profit on a winner (by preventing it to become a loser), you will have trades that were winners, dip into losers, then rally into winners again. There is no rational meaning in putting rules around a magic line where you entered. You should have your reward and your risk defined and then execute that over time to a specific expectancy. If you are good the you will have high positive expectancy, if you are bad then high negative expectancy.
 
Traderm


Thanks for responding.

I'm going to quote you something from John F. Carter, the author of the book, Mastering the Trade, Proven Tactics ......

Also, I would also like to touch upon not letting your winners turn into losers - this is big problem of mine....


I will update shortly..

Cheers
 
trade with 1 contract per 25k untill you have enough profits (=buffer for (stop)losses) to increase size
keep stoploss as tight as possible without it affecting performance (look into a percentage of ADR)
 
Hi Chuck

Thanks for responding.

I always get a little confused with its mentioned how much to trade per contract.

At the moment, whenever I enter a trade with the mini-dow I always enter with two contracts. I base that amount on how much I would like to make and how much I willing to lose.

Let me give an example

I wish to make $270 per trade. The I need 27 points. I only risk $160 per trade (don't forget I trade two contracts per trade).

Thats it. So no matter how much I have in trading account (which incidently is $25K), that's how I enter into a trade.

What do you think?


Cheers
 
Sounds fine to me as long as you are a good trader. With that level of risk/reward you need to be right more than 60% of the time.
 
I may be the odd man out here, but I personally believe you have to keep the risk management dynamic.

Not every YM trade setup will have the potential to earn you +27, and not every day is it worth waiting around for only the +27 setups. Also while most trades should have a 1:2 risk:reward, some should perhaps risk a little more, some a little less, depending on different criteria such as time of day, the particular strategy/setup, your current mental state, where your PnL is for the day/week ....

The market is not rigid so I think it's best to stay a little bit flexible while still clearly defining and managing the risk on each trade. The bottom line is take out as much as you can and give back as little as you can, knowing full well you always have to give back some. ... Just my .02 of course.
 
Quote from tomahawk:


Not every YM trade setup will have the potential to earn you +27, and not every day is it worth waiting around for only the +27 setups. Also while most trades should have a 1:2 risk:reward, some should perhaps risk a little more, some a little less, depending on different criteria such as time of day, the particular strategy/setup, your current mental state, where your PnL is for the day/week ....

More...

I totally agree.

I'm going post my trades for today.

Let me know what you guys think
 
Tomahawk/Chuck

If this isn't legible when I hit 'Submit' Ill organise and send it again.

SLD 2 YM JUN11 Futures 12037 USD ECBOT 14:44:05 4.02
BOT 2 YM JUN11 Futures 12036 USD ECBOT 14:47:30 4.02

SLD 2 YM JUN11 Futures 12026 USD ECBOT 14:53:00 4.02
BOT 2 YM JUN11 Futures 12020 USD ECBOT 14:54:07 4.02

SLD 2 YM JUN11 Futures 12014 USD ECBOT 14:54:19 4.02
BOT 2 YM JUN11 Futures 12004 USD ECBOT 14:58:31 4.02

SLD 2 YM JUN11 Futures 12006 USD ECBOT 15:02:47 4.02
BOT 2 YM JUN11 Futures 12003 USD ECBOT 15:06:39 4.02

SLD 2 YM JUN11 Futures 11993 USD ECBOT 15:08:55 4.02
BOT 2 YM JUN11 Futures 12004 USD ECBOT 15:17:52 4.02

SLD 2 YM JUN11 Futures 12005 USD ECBOT 15:20:49 4.02
BOT 2 YM JUN11 Futures 11991 USD ECBOT 15:26:12 4.02

SLD 2 YM JUN11 Futures 11992 USD ECBOT 15:31:26 4.02
BOT 2 YM JUN11 Futures 11987 USD ECBOT 15:32:18 4.02

SLD 2 YM JUN11 Futures 11980 USD ECBOT 15:40:39 4.02
BOT 2 YM JUN11 Futures 11977 USD ECBOT 15:43:05 4.02

SLD 2 YM JUN11 Futures 11972 USD ECBOT 15:46:12 4.02
BOT 2 YM JUN11 Futures 11974 USD ECBOT 15:47:11 4.02


SLD 2 YM JUN11 Futures 11978 USD ECBOT 15:54:59 4.02
BOT 2 YM JUN11 Futures 11964 USD ECBOT 16:05:14 4.02

SLD 2 YM JUN11 Futures 11962 USD ECBOT 18:11:52 4.02
BOT 2 YM JUN11 Futures 11962 USD ECBOT 18:15:53 4.02

SLD 2 YM JUN11 Futures 11956 USD ECBOT 18:24:56 4.02
BOT 2 YM JUN11 Futures 11955 USD ECBOT 18:35:17 4.02

SLD 2 YM JUN11 Futures 11953 USD ECBOT 18:36:31 4.02
BOT 2 YM JUN11 Futures 11946 USD ECBOT 18:37:53 4.02

SLD 2 YM JUN11 Futures 11942 USD ECBOT 18:40:27 4.02
BOT 2 YM JUN11 Futures 11935 USD ECBOT 18:51:13 4.02

BOT 2 YM JUN11 Futures 11,941.000 USD ECBOT 19:01:10 4.02
SLD 2 YM JUN11 Futures 11942 USD ECBOT 19:01:40 4.02

BOT 2 YM JUN11 Futures 11960 USD ECBOT 19:04:45 4.02
SLD 2 YM JUN11 Futures 11,985.000 USD ECBOT 19:08:01 4.02


SLD 2 YM JUN11 Futures 11976 USD ECBOT 19:09:50 4.02
BOT 2 YM JUN11 Futures 11976 USD ECBOT 19:12:18 4.02

SLD 2 YM JUN11 Futures 11,975.000 USD ECBOT 19:22:29 4.02
BOT 2 YM JUN11 Futures 11974 USD ECBOT 19:24:32 4.02

SLD 2 YM JUN11 Futures 11,967.000 USD ECBOT 19:25:06 4.02
BOT 2 YM JUN11 Futures 11984 USD ECBOT 19:27:28 4.02

SLD 2 YM JUN11 Futures 11970 USD ECBOT 19:35:15 4.02
BOT 2 YM JUN11 Futures 11967 USD ECBOT 19:39:41 4.02

BOT 2 YM JUN11 Futures 11993 USD ECBOT 19:57:52 4.02
SLD 2 YM JUN11 Futures 12008 USD ECBOT 20:49:22 4.02


I'm sure I need not have to tell you, the times are in GMT as I trade from London...

Cheers
 
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