JBL Risk Manager
| $199.00 |
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Description by Publisher
Protecting your Trading Capital
By Joseph Barrington-Lew
More than 90% of people trading the share market lose money because the majority do not use correct Money & Risk Management principles or have the discipline to follow them.
Money Management, Position / Trade Sizing No matter what you call it, You Better Know It!
"Money Management is like sex: Everyone does it, one way or the other, but not many like to talk about it and some do it better than others. But there��?trade;s a big difference: Sex sites on the Web proliferate, while sites devoted to the science of Money & Risk Management are somewhat difficult to find." - Gibbons Burke
NEVER risk more than 2% of your Trading Capital on any one trade. e.g. If you have $30,000 your maximum risk is $600 but what many forget is to also cater for brokerage. If it��?trade;s say $50 RT your maximum risk is now $550 and a stop is set appropriately so if your share drops in value by $550 you EXIT first opportunity.
Never Trade with more than 20% of Trading Capital on any trade.
e.g. Again, if you have $30K your trade size would be $6000 but I prefer to use 19% so if I have 5 open trades and will still have 5% of my trading capital out of the market to allow for things like slippage, education, data, etc.
Here��?trade;s a simple mistake many make regarding their Trading Capital? e.g. My 1st trade is now worth $7000, up $1000 so I decide to open my 2nd trade.
Do I base my next trade TC value $26,000 or $20,000 or $25,000 again?
The correct method is to first determine the share value if your current stop was hit. You may be up $1000 but your trailing stop is set and if hit you make less, say $900 so the next calculation would be based on $30,000 + $900. Your true Trading Capital is your available Cash + or ��� the value of all open positions if all stops were hit.
���The only thin
