Sunday, April 5, 2009

My position sizing - the crucial factor undermining my profit potential

I have discovered that position size is the main factor why I am not maximising my profit. I have undertaken too big a position. In order to let my trade fulfill their potential from now onwards, I will have to allocate a more realistic position size - and in my case, given my small capital a much smaller trade size. For example, in the Sino trade, I can only trade 2 lots. I must adjust my stock trading risk to be equal to 10% of my trading capital. Actually, this is still too much, but I will have to try.

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