Hello everybody!
Lately I searched FF for "risk management". It returned 99 pages of results. I read one by one the 250 first posts. 248 of them were instead about money management. I found only two of them were really about risk management. One is made of a single post of never answered questions. The second is one page long and the last post is about position sizing; understand money managment.
Either risk management is so trivial it goes without saying or it's the most overlooked element of trading in FF.
I'm sure that risk management is much more than just setting a SL the other side of the previous swing. Because risk management is mistaken with money management I chose another title to avoid any confusion. I wrote a PDF where I examine, on a purely probabilistic point of view, different trade managements to see how they perform in general. Don't hesitate to verify the equations! After a dozen proof readings I may have missed something...
I think this is only scratching the surface. I wish this will start an educated discussion. Unless it dies before the second page...
Lately I searched FF for "risk management". It returned 99 pages of results. I read one by one the 250 first posts. 248 of them were instead about money management. I found only two of them were really about risk management. One is made of a single post of never answered questions. The second is one page long and the last post is about position sizing; understand money managment.
Either risk management is so trivial it goes without saying or it's the most overlooked element of trading in FF.
I'm sure that risk management is much more than just setting a SL the other side of the previous swing. Because risk management is mistaken with money management I chose another title to avoid any confusion. I wrote a PDF where I examine, on a purely probabilistic point of view, different trade managements to see how they perform in general. Don't hesitate to verify the equations! After a dozen proof readings I may have missed something...
I think this is only scratching the surface. I wish this will start an educated discussion. Unless it dies before the second page...
Attached File(s)
Expectancy management.pdf
948 KB
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2,995 downloads
No greed. No fear. Just maths.