I have been in the Challenge since the 1st of December, 2016. I have been studying, watching videos, and watching the chat room every day with very few exceptions. I have been paper trading and can't wait for STT to come out with this feature tomorrow.
Anyway, I have been doing quite a lot of research on position size as I notice quite a few other folks take large positions sizes for the size of their accounts. If you have the capital like Timothy Sykes, Dux, or Tim G. then the position size can be quite large as they are potentially losing a small percentage of their accounts if they cut losses quickly. For someone with a small account like myself there are considerations on the amount of risk that one is willing to take. Remember there are no "sure things" in trading so this position size needs to be proportionate to the amount of risk you are willing to take. I have 2 small accounts that total $5000.00 If I take a 5% position (risk) that would be $100.00. Even though that does not sound like much as far as buying power I look it mathematically as to what I would need to make back if I lose this trade.
If I have a loss at 5% then I only need to make 5.3% gain to recover. If I risk 10% ($200), and I lose it then I need to make 11.1% to recover the loss. You can see how this is going so I will skip to some larger positions. If I decide that my position size will be 30%, which is $600, then I would need to make 42.9% ($858) on the next successful trade to be back even. Keeping the position size small based on the amount of risk you are willing to take can keep you in the game much longer when the trades do not go as planned.
This is why Tim keeps saying that small gains are the keys to growth and if I maintain a 2% risk for my position my account will not be blowup and as the capital increase so can the amount I am positioning at a 2% risk.
Just my thoughts and I am enjoying getting to know each of you in the chat. This has been one of the best investments in my education and future I have ever made!
See you all next Tuesday in the chat!