Recent content by ThomasJ02

The classic answer is to use the Kelly Criterion (google it if you haven't heard of it before). However, to use this, you'll have to be able to quantify your edge. To take your example, what does the expected return and standard deviation of your investment look like when rsi(14)<30? This might...

No, you would not necessarily end up with a positive balance. All else being equal, more stocks would hit the 1% stop loss than the 2% take profit. You would have more stocks taking smaller (1%) losses, balanced out by fewer stocks taking larger (2%) gains.