LindyBill's Ballroom Message Board

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Strategies & Market Trends : LindyBill's Ballroom

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To: OZ who wrote (14)	9/29/2001 10:23:03 PM
From: Mathemagician	of 248

FWIW, a good deal of my risk management strategy is borrowed from Trader Vic. His books have their good points and bad, but I can say without a doubt that the capital management strategy laid out therein is elegant and simply brilliant. For example, by always limiting potential losses to at most 5% of available risk capital, you can be wrong in 13 consecutive trades before losing 50% of your available capital (txns and tax benefits roughly cancel). A 3% limit buys you 23 bad trades before your 50% haircut. Hell, I've lost 50% of my capital in ONE bad LTBH position! dM

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