NB: Pro spin the wheel, beginners print and learn by heart:)
Part 1. Risks.
The basis of the risk management is the value of the daily stop – this is the maximum amount, that you can lose in a day. Personally, I am not a supporter of that, to count it every day according to some cunning scheme (for example, hang the moving average on schedule determine the profitability and stop per day by its value). But what exactly is worth doing – it is to decrease the day stop during the red bar. This allows you to relieve the psychological stress., get back to work and trade with a cool head. As results improve and self-confidence grows, stop needs to be increased. Raise it in 2 times too cool, but less, than one and a half – not seriously. Briefly speaking, уполторение – our choice:)
Part 2. Sizes.
If the right risk management combined with discipline and the GERCHIK golden rule “fuck or fuck” puts the teapot on let it be true, then competent size management distinguishes a successful trader from a mediocre one. If , the same mythical character, which I spoke about in my , force to trade all ideas in the same size – at best he will trade in 0.
How to determine the size, who need to enter the position? First you need to decide for yourself, сколько вы готовы потерять в идее. The resulting value must be divided by an adequate stop in cents, round in any direction – get a size.
Example: idea of 50$, risk of cents 15, 50/0.15~300sh.
Now let's dwell on the most important – how much can you lose in a specific idea? In order not to blow up your brain, all ideas should be divided into three classes:
Класс С. Just fucking ideas (we are good boys and we don't sell any shit, Really?). These include approximately 80% all ideas. Depending on their trading style, they need to be willing to sacrifice 10% to 25% day stop.
Class B. Just HUGE ideas. Yet 15%. Such should be allocated 30-50%.
Class A. Top 5%, they happen once in a lifetime / year / month. Confidence in them must go off scale! 50-100%, even if the day is just beginning.
Example: Сферический стачок АВС падает в сильный день на повышенном объеме, runs into a large bid, on 7 cents higher a big offer is placed, prints go into it (ОМГ, he is real!), the stack has not yet made half of its daily range. Bid print out planned. This is a clear B. Let our stop 100$. Looks so good, that fifty dollars is not a pity. 50/0.07~700sh. Выход в распринт офера, now we make a plan for where and how to fix the profit and forward!
Belonging to a class – it is a function of many factors: market, stock fundamental, news, cup, volumes, where and how these volumes took place, тапе, sector, setap, then, how it looks on different time frames, риски ликвидности, risk-return and much more.
You need to constantly work on the skill of defining the class of ideas. It's incredibly difficult., including psychologically, but this is the grail, кроме шуток:)
Напоследок забавная история. Тот самый Серега как-то раз на моих глазах набрал 10к (mb and embellish, but five were there anyway:) on strike, which trades about 100-150 thousand. Not, not because he's fucked up (reread the post, ёба!), but because he was confident in the idea and was ready to leave the entire day stop in it. It all went wrong at once, and throwing such a size into the market would immediately put the strike on the Top Loosers list.:) Briefly speaking, he sat and covered himself all day. About an hour before closing, he completed the process, fixing the elk in one and a half pieces. Got up and left. The end of the story I think everyone guessed it: under the closing, the stack shot in his direction by almost a point.
