I'm sorry if that didn't get updated on some of the text, but
over a year ago I explained that I was going from 1,2,3, to 2, 4, 6
contracts for MES because that allows me the ability to scale out
of one of them manually if I feel the need to and still have a
contract left. You can't sell 1/2 of 1 contract. And at
times if multiple systems are going long at the same day or one
system I feel is risky I have the ability to go back to 1 contract.
Otherwise default is 2, 4, 6.
For SPY I have always used 10K, however I find that $20K of SPY
is roughly equivalent to the G/L of 1 MES contract
again - these are just baselines - for you guys, whatever
instrument or instruments you do or how many shares or contracts is
entirely up to you, your risk tolerance, account size etc
FYI I updated the text in the MES mean reversion trade section -
the other reason I like to use 2 contracts as the base instead of
1, besides having the ability to scale out, is that sometimes I
choose to do a 1/2 size if too many systems are going long on the
same exact day or I feel it's a risky trade, I can move down from 2
to 1 contract. Again - do what is right for you - this is simply a
default template
Trades Shown:In the trade table below I'm using MES instead
of ES, which is the micro contract, that is 1/10 of the value of
one ES contract. Each 1 point move represents $5 ($50 for ES).
- For 1st, 2nd, 3rd entries I double up on the 2nd entry, and
triple up on the 3rd. One could do 1, 2, 3 for 1st, 2nd, 3rd
entries. For the website sometimes I elect to take a 1/2 position
size if I feel there is more risk, or I may elect to scale out of a
contract, therefore I generally use 2 contracts for the 1st entry,
4 for the 2nd entry, and 6 for the 3rd. For you, if 2,4,6 is
too much, you can do 1, 2, 3, or consider using a SPY related ETF
in place of futures - that decision is entriely up to you; your
risk tolerance and account size
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I'm sorry if that didn't
QQQ volatility system staying put as well
Posted by matt on 22nd of Jul 2024 at 04:06 pm
I'm sorry if that didn't get updated on some of the text, but over a year ago I explained that I was going from 1,2,3, to 2, 4, 6 contracts for MES because that allows me the ability to scale out of one of them manually if I feel the need to and still have a contract left. You can't sell 1/2 of 1 contract. And at times if multiple systems are going long at the same day or one system I feel is risky I have the ability to go back to 1 contract. Otherwise default is 2, 4, 6.
https://breakpointtrades.com/blog/post/427182/
For SPY I have always used 10K, however I find that $20K of SPY is roughly equivalent to the G/L of 1 MES contract
again - these are just baselines - for you guys, whatever instrument or instruments you do or how many shares or contracts is entirely up to you, your risk tolerance, account size etc
FYI I updated the text
Posted by matt on 22nd of Jul 2024 at 04:12 pm
FYI I updated the text in the MES mean reversion trade section - the other reason I like to use 2 contracts as the base instead of 1, besides having the ability to scale out, is that sometimes I choose to do a 1/2 size if too many systems are going long on the same exact day or I feel it's a risky trade, I can move down from 2 to 1 contract. Again - do what is right for you - this is simply a default template
Trades Shown:In the trade table below I'm using MES instead of ES, which is the micro contract, that is 1/10 of the value of one ES contract. Each 1 point move represents $5 ($50 for ES).
- For 1st, 2nd, 3rd entries I double up on the 2nd entry, and triple up on the 3rd. One could do 1, 2, 3 for 1st, 2nd, 3rd entries. For the website sometimes I elect to take a 1/2 position size if I feel there is more risk, or I may elect to scale out of a contract, therefore I generally use 2 contracts for the 1st entry, 4 for the 2nd entry, and 6 for the 3rd. For you, if 2,4,6 is too much, you can do 1, 2, 3, or consider using a SPY related ETF in place of futures - that decision is entriely up to you; your risk tolerance and account size