Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: nspolar who wrote (18322)	9/5/2002 12:03:46 AM
From: isopatch	Read Replies (1) \| Respond to of 36161

ns. Setting position limits is really a topic in itself. Don't want to take sides. I've got enough snipers after me already<lol> Pobably been some very good chapters written about it in the better books on trading. One easy way to come at it is to take a look at the intended holding period. If you like to run a group of pups for a few weeks at a time on average? Then it's easier to handle, say a dozen positons. Reason being you're not constantly turning them over, with the incumbent jumping from chart to chart at warp speed, etc. So, assuming a 10% cash reserve you end up with 7 1/2% of your trading capital in each holding. But how bout the ST guy? He's going to run a different operation. Let's say he's not even a day trader. But likes the 1-3 day window. It's going to be much harder for him to focus on 12 or more positions and still get the more precise entry and exit prices he needs than does his longer HP counterpart. Reason? He's shooting for 4-7% gains while the multi-weeker is looking for 10-15%. And whodathunkit?! A small fraction on each execution is a much bigger piece of that 7% pie than it is for the 15% total gain. Anyhow, 5 positions would probably be a good choice for him our STer. Again 10% in cash, results in 15% in each pooch. Now we're getting closer to that 20% threshold. And once you get to the big position day trader? Don't thing north of 20%/holding is going to be unusual. JMVVHO. Isopatch