“Percent Risk” model: Positions were sized so that the initial risk exposure was 1% of the account equity. This method returned $231,121, just less than the Fixed Amount model. “Equal Leverage” model: Each position in this model was 3% of the account equity.
“Fixed Amount” model: This method traded 100 shares per each $100,000 in equity. What is “Position Sizing” ? Resource:Van Tharp Book: Trade Your Way to Financial Freedom That model returned $32,567 or 0.58% annualized.
What is “Position Sizing” ? Resource:Van Tharp Book: Trade Your Way to Financial Freedom Van Tharp tested 4 models, with the same system, starting at $1 million with 595 trades over 5+ years Result # 1 - Worst … the “baseline model” which bought 100 shares of stock Please consult your tax consultant prior to making any investment that may impact your tax situation. BigTrends does not provide personalized financial, tax or legal advice. Not all Big Trends products or services are appropriate for all investors. You are solely responsible for your investment decisions, and BigTrends and its staff are not responsible for any trades you choose to make. The information presented here does not constitute a recommendation to buy or sell a particular investment. BigTrends ACE Coaching Advanced Position Sizing & Money ManagementĪccess to Big Trends and its coaching services is provided for educational and informational purposes only.
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