When do you include p&l to change position size?

A

aginvest88

I manage a couple of small accounts(about $32,000 each) trading forex.

My disclosure document states I can risk upto 1.5% on each trade.

The stops on all the trades I do are set at 100 pips and wanting to keep the risk per trade to about 1%, I am using 32,000 position size for all the trades.

I am trying to figure out when to change the position size to account for p&l.

Is it better to do it look at the account value real time before each trade and take a position based on that. Or maybe at beginning of each month or at some preset level - if for example the account is up/down 5%.
 
Bob Volman recommends calculating the value at the start of each new trading session to determine position size.
 
you could divide your acct by 12,and risk that amount per month max loss,if you are consistently profitable you could add that profit into the total and again divide by 12 and risk that increasing number,once you are on a consistently profitable streak,you could risk your monthly avg profit,there are a number of ways you could configure this, the common denominator here is limited risk, so that one tsunami day that could wipe you out won't,in this example you would at minimum stay in biz for a year

eventually you may get to a size constraint where you aren't comfortable increasing
just food for thought
 
You must log in or register to reply here.
Back
Top