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What is the best position sizing strategy?
The best position sizing strategy is not the same for every trader and varies by trading style and personal risk tolerance. However, if there was one rule by which all traders had to obey, it would be to risk a maximum of a few percents of the account in every trade.What is position sizing?
Position sizing is the process of determining the size of a trade and has significant effects on the performance of your trading or investment portfolio. Many new to trading make the mistake of taking on large positions, in the belief that they will make easy and quick profits.Why is position sizing important in the forex market?
In fact, position sizing will account for the quickest and most magnified returns that a trade can generate. Here we take a controversial look at risk and position sizing in the forex market and give you some tips on how to use it to your advantage.What is a volatility based position sizing strategy?
Volatility-Based Position Sizing Strategy Volatility based position sizing strategy uses a measure of volatility to determine the position size. Market volatility varies with time, and with higher volatility comes greater swings, which need to be taken into account when sizing your trades. Have a look at the chart below.