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'am away on business for a couple of days and will
respond on return.
----- Original Message -----
Sent: Tuesday, March 22, 2005 10:44
AM
Subject: Re: [EquisMetaStock Group] Van
Tharp's Money management (%Volatility Model) : need help !!!
Hi David,
Thanks for your explanation. I understand
this model applied to stocks now :). In other words, the "point value" for
stocks is always equal to 1.
By the way, why do you say Van Tharp's work is
not worthy ? ( what are the pros and the cons
?).
Regards,
Marco
PS : I'll take a look at Kase'
books.
David Jennings a écrit :
Marco,
For what van Tharp's rubbish is worth, assuming
50K USD and purchasing microsoft, then Microsoft is trading at 24.31 with a
daily range of 0.5. Lets say that the ATR for the last 10 days is 0.5. Then
the volatility is 50 USD per hundred shares. Using his 2% of equity at
risk i.e. $1000. Thus using his logic you would buy 2000 shares -
assuming your stop was placed 1 ATR below the purchase price.
I would counsel you to have a read of
Cynthia Kase's book. The piece on Dev stops is well worth the purchase price
in its own right.
----- Original Message -----
Sent:
Monday, March 21, 2005 9:52 AM
Subject:
[EquisMetaStock Group] Van Tharp's Money management (%Volatility Model) :
need help !!!
Hi,
I am
currently reading Dr Van Tharp's book "Trade Your Way to Financial Freedom" and I just can't
understand his "Percent Volatility Model" for stock trading (he gave
examples with futures but unfortunately not with stocks
!).
Might anyone
explain me with a example his "Percent Volatility Model" applied only
to stocks.
Thanks in advance for your
help,
Regards,
Marco
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