Positions to take

JAlex256

Newbie
3 0
How do you trade differently based on the size of your positions? What systems should be known in order to know what our position is before every order we send?
 

J_C_Anderson

Member
98 14
When you want ot enter the position, you need to pass through several steps:
- define you stop price level
- calculate distance between potential entry price and stop.
- using your risk on position, calculate the position size.

For exapmle, you want to buy the stock, current price is $5.00
- your stop is at $4.90, or $0.10.
- your risk is $10 per trade.
Calculation 10 / 0.1 = 100. So, you can buy 100 shares, and your risk will be $10 or 10c. in prie movement.
 

tomorton

Legendary member
7,157 931
One rule I always follow is that every single trade has to be the same size. If the trade passes all the tests which confirm I should make the trade, why would I not put in the maximum stake my money management rules allow?

If you find you're unhappy with the size of a trade, the way forward is to work out what factor is a concern, not to just trade smaller.
 

mason_ritter

Member
76 3
I too try not to open positions that vary too much in size, I trade the same instruments with relatively the same positions in terms of size almost every time.
 

Pat494

Legendary member
13,261 1,276
One rule I always follow is that every single trade has to be the same size. If the trade passes all the tests which confirm I should make the trade, why would I not put in the maximum stake my money management rules allow?

If you find you're unhappy with the size of a trade, the way forward is to work out what factor is a concern, not to just trade smaller.
Alternatively keep a record of your trades and see which you get better results from, especially in forex. Then up the size of those trades and vice versa.
 

tomorton

Legendary member
7,157 931
Alternatively keep a record of your trades and see which you get better results from, especially in forex. Then up the size of those trades and vice versa.

This is a good principle and one that I effectively follow as I let all my winners pyramid automatically as they pass pre-set milestones.
 
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mason_ritter

Member
76 3
In general it's always prudent to keep a detailed record of your trades that you can consult in at any time, so you can see what went wrong, what went right, what needs changing, etc.
 

Merk Porter

Junior member
44 0
We are not in the track of random trading decisions; rather we now should take positions on currency pairs as per our trading requirements. Moreover if I say especially a foreign currency exchange trader should take position on any currency pair as per his trading capacities to bear risks. However, I personally favor major currency pairs to trade and I choose my order size as per my current portfolio situation.
 

mason_ritter

Member
76 3
Impulse trading rarely leads to good results, and when it does it's a metter of chance and luck, not strategy. Follow your trading plan and don't open positions on a whim.
 

NVP

Legendary member
36,279 1,787
keep sizing the same generally.........perhaps I do size based on market volatility at times if we have extreme situations ....like I traded through the night on the brexit vote and did size down a lot .............
 

NVP

Legendary member
36,279 1,787
How do you trade differently based on the size of your positions? What systems should be known in order to know what our position is before every order we send?
same consistent capital value in % terms devided into the stop loss appropriate for the trade
 

Pat494

Legendary member
13,261 1,276
One method is to use pivots.
You put limit orders on the support AND resistance levels.