|
PureBytes Links
Trading Reference Links
|
Super,
I understand the volatility-based sizing, but have a question about
the fixed fractional risk number itself.
Say you choose your risk per trade to be 2% of account equity. Do you
ever modulate that 2% (say to 1% or 3%) based on how your portfolio
equity curve is doing, or based on if you are in a winning streak or
losing streak? If so, can you share your experience?
I find it odd that there is much published work about money mangement
when it comes to futures/comodities, but little related to stocks....
As always, thanks much for your guidance.
--- In equismetastock@xxxxxxxxxxxxxxx, superfragalist <no_reply@xxxx>
wrote:
> I have been accused of promoting Roy's newsletter. That accusation is
> alleged and the merit as yet undetermined. Without admitting or
> denying anything, if it sounds like I promote the newsletter, it's
> because it's such a good MS tool that I think every MS user should use
> it.
>
> In fact, Equis should give everyone who purchases MS a free one year
> subscription. (I'm sorry, I lost my head for a minute. I know that's
> just being too rational.)
>
> However, unlike Equis I don't ignore the users and what they need to
> be successful. So as a gift to everyone who subscribes to Roy's
> newsletter this month, I'm going to give you a terrific position
> sizing indicator that calculates the number of shares of a particular
> stock that you should buy based on your personal risk profile and the
> volatility of the stock.
>
> This is a powerful tool for position sizing, so don't ignore it. Test
> it out and see if it improves your returns. It's based on sound theory
> of money management.
>
> CapitalAccount:=Input("Size of Capital Account",5000,10000000,100000);
> RiskPercent:=Input("Account Risk Tolerance in
Decimals.",0.001,100,0.01);
> {This is the amount of your account balance you're willing to lose per
> trade-- 0.01 equals 1%.}
> VT:=Input("ATR Periods for Calculating Volatility.",1,100,10);
> Bars:=Input("Number of Bars for Smoothing ATR.",2,100,10);
> WhimpFactor:=Input("Personal Risk Profile-1 Cowboy to 7 Whimp",1,7,3);
> {1 means you ride bulls and live hard, 7 means you're Mister
> Rogers--most people fall in between.}
> x:=Mov(ATR(VT),Bars,S);
> RiskPercent*CapitalAccount/(x*WhimpFactor)
>
> Plot this on the chart and read the shares to include in your
> portfolio at the current price.
>
> Yes, I know I'm giving it to you before you subscribe. I work off of
> the honor system, so I know that everyone who reads this will honor
> the deal and sign up. This one indicator alone is worth the price.
>
> www.metastocktips.co.nz
>
> I know who's being naughty and nice, I'm making a list and counting it
> twice. So look out, Christmas is coming. It's not a good time to be
> breaking the honor code. Okay!
Yahoo! Groups Links
<*> To visit your group on the web, go to:
http://groups.yahoo.com/group/equismetastock/
<*> To unsubscribe from this group, send an email to:
equismetastock-unsubscribe@xxxxxxxxxxxxxxx
<*> Your use of Yahoo! Groups is subject to:
http://docs.yahoo.com/info/terms/
|