While trading it is very important to know when to press the pedal and accelerate your trading. Read the following link for few ideas related to this:
TheStockBandit.net ยป When to Trade Aggressively
While trading it is very important to know when to press the pedal and accelerate your trading. Read the following link for few ideas related to this:
TheStockBandit.net ยป When to Trade Aggressively
Hiren said
True but bigger position sizes should have tight stop losses and trailing stops also I suppose?
SwingTrader said
Not necessarily. Even if you increase your position size your stop would still be proportional to your entry price. It all depends on how you compute your stop level. If you are using entry price minus 1.5 times ATR(10) as the stop then even if your position size increases the stop will still remain at 1.5 times ATR(10) below entry price.
Sometimes larger position size is psychologically difficult to handle but if you have confidence in your trading system then you should be able to handle it. Tightening your stop can be counter productive if done without a good reason. The question to ask before you tighten your stop would be – Would I tighten my stop if I was trading using an insignificant position size? If the answer is no then do not tighten the stop. If you are uncomfortable with the position size then bring it down.
Jeff said
Thanks for the link back, keep up the good work with your trading blog!
Jeff
http://www.TheStockBandit.net