How much 'heat' do peopel have?

Adecco

Junior member
46 3
I started a coupel of other hreads in thsi section in trying to come up with my system.

My next question is - how much total risk do people have open at amny one time?

My own rule i think is to have a 10% total risk open at anyone time. (with 2% per position)

That means - if i close a position due to losing the 2% i would then look to open another one to maintain the 10% total risk.
Or - alternatively if my initial SL gets raised (thereby reducing my total risk) i would again look to open another position to maintain the 10% total risk.

My main idea being if my system has a positive expectancy then i want to have open positions to take advnatge of thsi positive expectancy. (Obviously onlytime will tell whetrehr it does or does not have a positive expectancy)

Basically i aim to have 10% OPEN risk at ALL times. (but no more)

Can anyone point out anything particularly wrong with teh above logic?
 
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tomorton

Legendary member
8,199 1,253
In forex I will go 4% on first and second positions (swing trades on daily prices) as long as they don't closely correlate. One or both will usually start to go my way within 1-3 days when I will trail the stop continually towards break-even to reduce exposure. Then I'll be thinking about adding a third position, still hopefully non-correlating but this would probably be 3 or 2%. When a position goes to b/e, that would allow me a fourth position and so on. I rarely find I have 5 positions open at once. I'm not absolutely always in the market, oprobably 80% of the month.
 

barjon

Legendary member
10,676 1,797
I started a coupel of other hreads in thsi section in trying to come up with my system.

My next question is - how much total risk do people have open at amny one time?

My own rule i think is to have a 10% total risk open at anyone time. (with 2% per position)

That means - if i close a position due to losing the 2% i would then look to open another one to maintain the 10% total risk.
Or - alternatively if my initial SL gets raised (thereby reducing my total risk) i would again look to open another position to maintain the 10% total risk.

My main idea being if my system has a positive expectancy then i want to have open positions to take advnatge of thsi positive expectancy. (Obviously onlytime will tell whetrehr it does or does not have a positive expectancy)

Basically i aim to have 10% OPEN risk at ALL times. (but no more)

Can anyone point out anything particularly wrong with teh above logic?

The route is that your system tells you when to enter a trade and your money management tells you how much to risk on it.

You can't really reverse the process and enter a trade because you reckon you need to risk some money.
 

Adecco

Junior member
46 3
The route is that your system tells you when to enter a trade and your money management tells you how much to risk on it.

You can't really reverse the process and enter a trade because you reckon you need to risk some money.


Sorry - to clarify.
WOIth my systme ther eare always trades that fulfill my entry criteria. So that was teh contect of my original post.
 

barjon

Legendary member
10,676 1,797
Sorry - to clarify.
WOIth my systme ther eare always trades that fulfill my entry criteria. So that was teh contect of my original post.

So you're going to take some and not others? Picking and choosing from what your system throws up.
 

Adecco

Junior member
46 3
So you're going to take some and not others? Picking and choosing from what your system throws up.

Correct. If i want to maintain a maximum level of heat thnen i am limited to selecting only select some entries.

So my query is I'm trying go see if anyone sees anything wrong with trying to keep it at 10%.
 
 
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