Clueless money & risk management

15 min tlb · Mar 17, 2013

Most advice given in books seminars and trading education by gurus is

Risk 2 % per trade , it works well in winning streaks.

If a trader gets 15 losses in a drawdown , he would lose 30 % of his account .So this advice is given by clue less gurus.

In order to get 5 % drawdown from 16 losses , a trader should risk no more than 0.33 % per trade .

Most of you are buying books written by failed traders. , money management is the area of poor advice.

Liquid validity · Mar 17, 2013

15 min tlb said:
Most advice given in books seminars and trading education by gurus

Isn't that exactly what you are, a self appointed guru?

15 min tlb said:
Most of you are buying books written by failed traders. , money management is the area of poor advice.

I thought the area of poor advice was the endless torrent of threads you create.
Compounding to a billion in 5 years, that should be in the hall of fame...
http://www.trade2win.com/boards/foyer/165180-compounding-billionaires-t2w.html

pboyles · Mar 17, 2013

15 min tlb said:
Most advice given in books seminars and trading education by gurus is

Risk 2 % per trade , it works well in winning streaks.

If a trader gets 15 losses in a drawdown , he would lose 30 % of his account .So this advice is given by clue less gurus.

In order to get 5 % drawdown from 16 losses , a trader should risk no more than 0.33 % per trade .

Most of you are buying books written by failed traders. , money management is the area of poor advice.

You should submit an article on the subject to T2W.

barjon · Mar 17, 2013

And the probability of getting 16 losses on the trot is the same for everyone I suppose? If you are going to sneer at the advice from "gurus" then at least understand how it works.

15 min tlb · Mar 17, 2013

Liquid validity said:
Isn't that exactly what you are, a self appointed guru?

I thought the area of poor advice was the endless torrent of threads you create.
Compounding to a billion in 5 years, that should be in the hall of fame...
http://www.trade2win.com/boards/foyer/165180-compounding-billionaires-t2w.html

The poor advice is given by traders who hang around internet , looking for clues on websites to become efficient . looking for the missing jigsaw pieces in their failing careers.Them following failed traders cum authors , and regurgitating same old crap on internet and spewing it on forums.

Liquid validity · Mar 17, 2013

15 min tlb said:
Risk 2 % per trade , it works well in winning streaks.

If a trader gets 15 losses in a drawdown , he would lose 30 % of his account .So this advice is given by clue less gurus.

In order to get 5 % drawdown from 16 losses , a trader should risk no more than 0.33 % per trade .

You are aware that a 30% drawdown is not solely connected to consecutive losses
I take it?
Its perfectly possible to have a 30% drawdown with the longest losing streak
of around 4-6.

These concepts are not independent modules.
Money management alone is quite useless without thoroughly understanding
of the edge it is applied to.
That is supposing you even have one in the first place...

15 min tlb · Mar 17, 2013

barjon said:
And the probability of getting 16 losses on the trot is the same for everyone I suppose? If you are going to sneer at the advice from "gurus" then at least understand how it works.

It is much more probable for new learners , in fact the figure can be as bad as 30 to 40 for losers.The experienced and skilled will easily get to 10 losers as their maximum in a draw down .

Liquid validity · Mar 17, 2013

15 min tlb said:
The poor advice is given by traders who hang around internet , looking for clues on websites to become efficient . looking for the missing jigsaw pieces in their failing careers.Them following failed traders cum authors , and regurgitating same old crap on internet and spewing it on forums.

Yeah, like I said - you.
You just described yourself, and don't even know it - lulz

Anyway, thats enough trolling from me, as you were

Liquid validity · Mar 17, 2013

15 min tlb said:
It is much more probable for new learners , in fact the figure can be as bad as 30 to 40 for losers.The experienced and skilled will easily get to 10 losers as their maximum in a draw down .

F**k me, win rate, consecutive wins / losses, why do people
obsess over things that aren't as important?

You think an 85% strike, max of 2 losers in a row guarantees success?
You are talking about isolated factors of an egde.
The whole blend is what matters.

For anyone that knows no better, FFS read this thread instead:
http://www.trade2win.com/boards/gen...on-sizing-compounding-keys-magic-kingdom.html

15 min tlb · Mar 17, 2013

Liquid validity said:
Yeah, like I said - you.
You just described yourself, and don't even know it - lulz
Anyway, thats enough trolling from me, as you were

I am only risking 3 % per currency pair , per 6 methods , that is 0.5 % per method .0.5 % allows 8 losses per method * 6 losses =48 losses .

That is as sound as it gets , now I can take to the next level , with gbp 10 per pip , with proportionately higher account size.

the hare · Mar 17, 2013

barjon said:
And the probability of getting 16 losses on the trot is the same for everyone I suppose? If you are going to sneer at the advice from "gurus" then at least understand how it works.

True, but its not just about consecutive losses

barjon · Mar 17, 2013

the hare said:
True, but its not just about consecutive losses

true, too, but you know what i was getting at

the hare · Mar 17, 2013

I think his lithium dose probably needs tweaking

15 min tlb · Mar 17, 2013

barjon said:
true, too, but you know what i was getting at

16 losses in a drawdowm not consecutive , even 16 consecutive is possible.

the hare · Mar 17, 2013

barjon said:
true, too, but you know what i was getting at

Indeed I do

15 min tlb · Mar 17, 2013

the hare said:
I think his lithium dose probably needs tweaking

Whose on lithium?He had a history of mental illness.

the hare · Mar 17, 2013

15 min tlb said:
16 losses in a drawdowm not consecutive , even 16 consecutive is possible.

There you go

1/p + 1/p^2 + 1/p^3

Now you know how many trades you need to take before it happens

15 min tlb · Mar 17, 2013

Why you guys advising 1 to 2 % ?That is trader suicide advice.

http://www.trade2win.com/boards/risk-money-management/113254-1-risk-per-trade.html

the hare · Mar 17, 2013

15 min tlb said:
Why you guys advising 1 to 2 % ?That is trader suicide advice.

In some / many circumstances its suicide, in other circumstances, its not

The real problem is that the answer isn't a simple constant, but its probably pointless discussing it further with someone who doesn't even understand the basics of fixed fractional position sizing

15 consecutive losses at 2% isn't 30%

Liquid validity · Mar 17, 2013

the hare said:
I think his lithium dose probably needs tweaking

Aye a fivefold increase should do the job nicely

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