Monday, January 12th, 2009
How much of your total trading account should you risk?
I have an article in the latest issue of Your Trading Edge Magazine on how much of your portfolio to risk.
As I say in the article, there is a lot of focus on how much to risk on each trade; ie 1 or 2 per cent. But returns are determined by how much of your portfolio to risk; ie how many of those 1 to 2 per cent individual risks you take.
I explain a few methods to determine optimal portfolio risk and how to practically implement them using an Excel spreadsheet.
The magazine is available on newstands in the Asia-Pacific, and by subscription in other parts of the world.
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