Risk Management Chapter 3
The Martingale Strategy A Risk-Seeking Approach The Martingale System is a methodology used to increase the odds of recovering from a losing streak. Introduced in the 18th century by French mathematician Paul Pierre Levy, it has its roots in gambling. The core idea behind the Martingale system is this: Statistically, you cannot lose all the […]
Risk Management Chapter 2
We started this series of articles last week and it is going to take us on a trader’s journey to learn how to manage risk and how to become a profitable trader. Position sizing continued… Fixed $$$ Amount This stop loss strategy is very similar to the one discussed last week. However, it is better […]
Risk Management Chapter 4
The Kelly Criterion Let’s explore the Kelly Criterion and how it applies to managing risk while trading. The Kelly Criterion is a powerful tool that can help traders determine the optimal size of their positions based on considerations of risk and return. Maximizing Returns with Risk Management What Is the Kelly Criterion? The Kelly Criterion […]
Risk Management Chapter 1
This is a series of articles which will take us on a trader’s journey to learn how to manage risk and become a profitable trader. Preface In the world of trading, the road to success is often paved with many unexpected twists and turns along the way. Many embark on it hoping to gain financial […]