I hope everyone is enjoying the day off with family, friends,
and time to reflect.
I'm interested in hearing how others here balance their max
number of active positions with trade sizing/risk
management.
Myself, I can only track 3-4 active positions on an intraday
basis, but that means either sitting mostly (80%) in cash (to keep
each position's risk contained), adding more positions (and losing
track of their sudden movements), or sizing each position large (up
to 25-35% of account in each).
I can balance more than that, maybe up to 10, but honestly less
is more and every time I've been in situations where I've had too
many positions, I've always under performed. It sounds like you are
mostly talking about day trade setups, however what happens to me
is that I trade something, then sell 1/2 and 2/3 of the position
and if it looks good I keep 1/3 to 1/4 of the original position for
a runner. This keeps accumulating and eventually there have
been times when I had up to 30 positions, again not new positions
but small runner pieces of trades that I had done days ago or even
weeks ago. Mind you this is a good trending market not the
volatile mess we have now. Anyway It's nice to keep runners
to allow positions to play out, raise stops, but eventually you
just gotta start selling to reduce the number of positions. Every
time I've gotten to point like that, I'll manage it well for a
while but eventually get burned. Always best to try and limit
the number and focus on few items.
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I hope everyone is enjoying
Posted by rojoch on 22nd of Nov 2018 at 02:48 pm
I hope everyone is enjoying the day off with family, friends, and time to reflect.
I'm interested in hearing how others here balance their max number of active positions with trade sizing/risk management.
Myself, I can only track 3-4 active positions on an intraday basis, but that means either sitting mostly (80%) in cash (to keep each position's risk contained), adding more positions (and losing track of their sudden movements), or sizing each position large (up to 25-35% of account in each).
How do others here balance this??
I can balance more than
Posted by matt on 22nd of Nov 2018 at 08:18 pm
I can balance more than that, maybe up to 10, but honestly less is more and every time I've been in situations where I've had too many positions, I've always under performed. It sounds like you are mostly talking about day trade setups, however what happens to me is that I trade something, then sell 1/2 and 2/3 of the position and if it looks good I keep 1/3 to 1/4 of the original position for a runner. This keeps accumulating and eventually there have been times when I had up to 30 positions, again not new positions but small runner pieces of trades that I had done days ago or even weeks ago. Mind you this is a good trending market not the volatile mess we have now. Anyway It's nice to keep runners to allow positions to play out, raise stops, but eventually you just gotta start selling to reduce the number of positions. Every time I've gotten to point like that, I'll manage it well for a while but eventually get burned. Always best to try and limit the number and focus on few items.