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How much of your trading capital do you risk per trade?

Discussion in 'Trading Strategies/Systems' started by StockyGuy, May 10, 2019.

  1. Zaxon

    Zaxon The voice of reason

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    1% risk per share still leaves you at 10% (etc) total portfolio heat should the market crash and all your shares drop. I know there are some people who won't take a new position until existing ones have break even stops in place. This reduces your total exposure in a crash. I don't operate this way. But for those who are more risk averse, it can be an extra layer of protection.
     
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  2. willoneau

    willoneau

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    How you determine the risk also has a lot to do with the % you wish to allocate and what risk profile you personally have.
    Slippage and delisting are also factors we should include when determining risk, usually by some % of probability of happening.
     
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  3. Bernfeld

    Bernfeld

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    The maximum percentage of risk that I use is 5%. Over the years, this is the best value for me. When I used 1-2%, the profit was 50% less. The greater the risk, the greater the profit and vice versa. But, of course, the risk should be limited.
     
    satanoperca likes this.
  4. tech/a

    tech/a No Ordinary Duck

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    Yes I agree but the risk doesn't have to increase.
    When Trading Futures I often have my full account at risk.

    Currently with shares I have 2 positions with 85% of my account committed.

    If your portfolio trading then a % or a fixed $ amount is best.
    But as I have explained further you can mitigate the initial risk
    very quickly.
     
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  5. willoneau

    willoneau

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    Hi tech/a , do you build those two positions ?
     
  6. tech/a

    tech/a No Ordinary Duck

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    One yes the other I really liked.
     
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