Weekly Newsletter   Challenge account   Weekly Newsletter   

Strategy – money management II.

In the previous post I was talking about money management I apply on my trading. In summary this is my settings:

– maximum draw tolerance 25% (if all my trades will be a failure my account will loose 25% of its value)

– maximum risk per one trade (stop loss per trade) 5%

– with these rules I could open only 5 positions at the same time

– maximum size of an initial position $463.6 (w/ margin; w/o margin $297.6)

My goal is to decrease all risk to minimum while I could be able to open more positions (up to max. 10). With small money I understand that the account will be riskier than the account with larger amount of money available to invest. However right now I have margin available and this gives me an opportunity to change the risk control setting closer to my goal:

– maximum draw tolerance 20%

– maximum risk per trade 3%

– maximum open trades at the same time 7

– maximum size of an initial position $278.2 (w/ margin)

Leave a Reply

Your email address will not be published. Required fields are marked *