Short Term Trading Weekend Lounge: 15-17 Feb, page-4

For a discussion topic i would like to ask the following question:

Did the feb and october of 2018 drops make anyone fundamentally change the way they trade?  With special attention on risk and money management.



After the feb 2018 crash i sold all my holdings and started from scratch, adhering to a risk and money management strategy of no more risk than 1% of my portfolio on any one trade and to decrease or increase the size of each parcel as my portfolio grew or shrank.  I do plan to inject a bit more capital into my portfolio in the near future which will allow me to spread my risk even thinner to perhaps 0.6 - 0.7% for each trade.  It will mean more positions but i'm fine with that.

I do believe i reaped the rewards of this in the more recent october crash.  Of 26 trades from the start of september until new years eve, 25 were losers and 1 winner with my account briefly touching -ve 20% at its worst.  With the money management strategy of shrinking position size as my portfolio shrank i believe the worst damage was done at the start and then started tapering off towards the end.  If i had 25 losing trades in a row on my old system i have not a doubt in my mind that i would have been wiped out.

Would love to hear others experiences if any.

cheers guys.