As per "More Money Than God" by Sebastian Mallaby, it was prime minister John Major not permitting Bank of England governor Geoffrey Howe to act because he wanted to project an image of strength IE EGO.
Risking 1% of your total equity. Does this refer to the stop?
- Thread starter rogersmithiii
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As per "More Money Than God" by Sebastian Mallaby, it was prime minister John Major not permitting Bank of England governor Geoffrey Howe to act because he wanted to project an image of strength IE EGO.
He got it rather wrong, then: undeniably, Geoffrey Howe held many illustrious positions of state, during his political career, but "Governor of the Bank of England" certainly wasn't among them!
He got it rather wrong, then: undeniably, Geoffrey Howe held many illustrious positions of state, during his political career, but "Governor of the Bank of England" certainly wasn't among them!
You are quite right, I stand corrected. It was Baron Kingsdown, Robin Leigh Pemberton.
Leigh Pemberton, yes. But he didn't actually have the legal power to do what was necessary, because the government had not yet (at that point) made the Bank of England independent of government, in its decision-making; indeed, it was precisely that episode that prompted the next government to do so.
Great post, the amount you risk shouldnt be static, for example i risk about 1% of my account on every random day trade but i take about 4-5 trades per day my win percentage is about 63%, but there are certain positions im willing to commit to and average down hard if it goes against me i have a max loss on those at about 10%-20% of my account but when i get those ideas i win 95% of the time, and my wins are as big as losses.
Example this week was TVIX, was shorting that thing in my main account from 39 ended up averaging into it and getting bigger and bigger until my average was about 41, i was pretty comfortable adding on it all the way too 45 if it got to 46-47 i would have lost about 10-15% of my account but i know with these 3x leveraged instruments they just melt when the market turns, ended up making 6 bucks on the majority of the position still have 400 shares left holding as a swing since it loses value so quickly over time. Also if TVIX got to 46-47 the market would have been so bad it would have made up for the loss on TVIX anyways, cause volatility would have been off the charts.
IMO if you dont put more money on the table in the few trades that present a better opportunity you wont be able to aggressively grow an account, but you need to know your numbers on those trades i.e. you cant be risking 10% of your account on every single trade if your win rate is only 63% but if your win rate is much much higher on certain once a week/once amonth/once a year opportunities you can put alot more behind it.
Whe oil broke 30 bucks a barell i put half of my retirement accounts into an oil ETF cant remember the ticker now for some reason, so i guess i was risking half of my account if oil went to zero, but i never would have punched out of that position for a loss, i just couldnt see how oil could ever go so low it would never get back to 30 bucks a barrell. I sold way to early, but i would have been willing to average down all the way to zero on that one. I never would have been willing to do that on a stock but oil was always going to hold some kind of value.
Example this week was TVIX, was shorting that thing in my main account from 39 ended up averaging into it and getting bigger and bigger until my average was about 41, i was pretty comfortable adding on it all the way too 45 if it got to 46-47 i would have lost about 10-15% of my account but i know with these 3x leveraged instruments they just melt when the market turns, ended up making 6 bucks on the majority of the position still have 400 shares left holding as a swing since it loses value so quickly over time. Also if TVIX got to 46-47 the market would have been so bad it would have made up for the loss on TVIX anyways, cause volatility would have been off the charts.
IMO if you dont put more money on the table in the few trades that present a better opportunity you wont be able to aggressively grow an account, but you need to know your numbers on those trades i.e. you cant be risking 10% of your account on every single trade if your win rate is only 63% but if your win rate is much much higher on certain once a week/once amonth/once a year opportunities you can put alot more behind it.
Whe oil broke 30 bucks a barell i put half of my retirement accounts into an oil ETF cant remember the ticker now for some reason, so i guess i was risking half of my account if oil went to zero, but i never would have punched out of that position for a loss, i just couldnt see how oil could ever go so low it would never get back to 30 bucks a barrell. I sold way to early, but i would have been willing to average down all the way to zero on that one. I never would have been willing to do that on a stock but oil was always going to hold some kind of value.
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This question is the result of reading / listening to Van Tharp, and trying to understand position sizing.
I played Van Tharp's marble game, and was amazed at how position sizing can drastically change the results of trading efforts.
I played Van Tharp's marble game, and was amazed at how position sizing can drastically change the results of trading efforts.
I do not believe in always placing the same size bet every time although I keep my avg risk per trade under 1%, there are times I will go as high as 2.5%. When volatility as at extremes during panics the reward-risk is heavily skewed - the upside is massive in relation to the down side. To allow for wider swings I will use an ETF (SPY/QQQ/IWM/etc) and layer only into already profitable positions - when the profit is >200 basis points I switch to a futures contract to free up capital.
Like Soro's said - you want to leverage on profits not on the principal.
Like Soro's said - you want to leverage on profits not on the principal.
Soro seldom risked just 1%. In the bet against the British pound he risked 200%.
Risking 1% per trade means that you cap your loss at $1,000 per trade if you have $100k in your account.
Peter Brandt says that if you risk more than 2% per trade, you will blow up eventually.
https://www.peterlbrandt.com/your-mean-risk-per-trade-is-3-2-you-are-crazy/
Peter Brandt says that if you risk more than 2% per trade, you will blow up eventually.
https://www.peterlbrandt.com/your-mean-risk-per-trade-is-3-2-you-are-crazy/