gawdib
27th December 2003, 09:22 PM
manual p -93: =��" Capital risked per trade This parameter determines the TOTAL AMOUNT OF CAPITAL RISKED PER TRADE and is specified in dollars. �� Position Size Limit This parameter limits the maximum position size of any one trade to a value that is a fraction of the total trading capital at the time the trade is to be taken. o Example As an example say you currently have $100,000 tied up in both open positions and cash ie your total trading capital is $100,000. You risk 1% ($1000) of your trading capital on a trade
and calculate the position size/value of the trade according to the difference between the entry price and initial stop price. If your position size is limited to 10% of total trading capital (ie 10K) then the trade will be capped at 10K even if the position size required is greater than 10K."
(BUT , when you indicated in the example that already one had decided to risk only 1%(1000), Why bother to then say "my position size limit is 10 times this...(ie 10K) To do so seems worthless?
1.I cannot figure out if after one has already limited the $ risked per trade (by using the capital risked per trade choice), then on can EVEN FURTHER limit this MAXIMUM amount by one's choice of position size limit. ? I think that would be helpful, but does not seem indicated by the example.
2I cannot grasp what the benefit is by 2 different limitations.
2a Also, usually is there an average "money usage" approach/recomendation to this. ?
I do know that presently I just sort of guesstimate that "well i think maybe that 3000 dollars sounds like a lot so i do not want to somehow sort of "risk" more. Then, I say well, is there any way of further limiting my risk... maybe some sort of (metastock language) maximum- loss- of- intial- trade -commited -capital stop and some sort of profit- gaurd stop. tHIS SEEMS a poor way of doing it. I would like to be able to write into my coding of a trading system that makes these decisions automatically,
but it is implied that one manually calculate each time (from above phrase on page 93:" As an example, say you...calculate the position size/value of the trade according to the difference between the entry price and initial stop price. ".
3.Is there a way of choosing these separately the way that metastock allows one to?
I have often tried to write in a profit gaurd stop into the coding of me exit signal as an alternative to my "main " way of exiting.
4. But tradesim system seemes to indicate {"Important: The initial risk is only really valid if a protective stop or trailing stop has been used to limit the maximum loss of the trade to a level, which corresponds to the initial stop value. To enable protective stops when generating a trade database please refer to the section in the previous chapter Using the Initial Stop as a Protective (Money Management) Stop for more details on how to do this. " } Thus, i am forced to use my intital stop inital capital loss stop " as proft gaurd stop too?
I would just like to be sure I understand fully what the tradesim "rules" are and what it allows. for example, somehow the tradesim system picks up such terms as "entryprice." So can I then put "entryprice-3*ATR(1) or c<.88*hhv(c,20) "into the spot "optional stop" in the below module you provided?
{{{{ ExtFml( "TradeSim.RecordTrades",
"superoffhv", { Trade Data Filename }
LONG, { Trade Position Type }
EntryTrigger, { Entry Trigger }
EntryPrice, { Entry Price }
entryprice-3*ATR(1) or c<.88*hhv(c,20),{ Optional Initial Stop }
ExitTrigger, { Exit Trigger }
ExitPrice, { Exit Price }
START); { Recorder Control } }}}
5. the manual says that the tradesim program will not fully work in some instance if "it does not detect a valid inital stop"
Could you please give what criteria the tradesim program uses to make this determination of validity?
thank you very much, regards, geoffrey
and calculate the position size/value of the trade according to the difference between the entry price and initial stop price. If your position size is limited to 10% of total trading capital (ie 10K) then the trade will be capped at 10K even if the position size required is greater than 10K."
(BUT , when you indicated in the example that already one had decided to risk only 1%(1000), Why bother to then say "my position size limit is 10 times this...(ie 10K) To do so seems worthless?
1.I cannot figure out if after one has already limited the $ risked per trade (by using the capital risked per trade choice), then on can EVEN FURTHER limit this MAXIMUM amount by one's choice of position size limit. ? I think that would be helpful, but does not seem indicated by the example.
2I cannot grasp what the benefit is by 2 different limitations.
2a Also, usually is there an average "money usage" approach/recomendation to this. ?
I do know that presently I just sort of guesstimate that "well i think maybe that 3000 dollars sounds like a lot so i do not want to somehow sort of "risk" more. Then, I say well, is there any way of further limiting my risk... maybe some sort of (metastock language) maximum- loss- of- intial- trade -commited -capital stop and some sort of profit- gaurd stop. tHIS SEEMS a poor way of doing it. I would like to be able to write into my coding of a trading system that makes these decisions automatically,
but it is implied that one manually calculate each time (from above phrase on page 93:" As an example, say you...calculate the position size/value of the trade according to the difference between the entry price and initial stop price. ".
3.Is there a way of choosing these separately the way that metastock allows one to?
I have often tried to write in a profit gaurd stop into the coding of me exit signal as an alternative to my "main " way of exiting.
4. But tradesim system seemes to indicate {"Important: The initial risk is only really valid if a protective stop or trailing stop has been used to limit the maximum loss of the trade to a level, which corresponds to the initial stop value. To enable protective stops when generating a trade database please refer to the section in the previous chapter Using the Initial Stop as a Protective (Money Management) Stop for more details on how to do this. " } Thus, i am forced to use my intital stop inital capital loss stop " as proft gaurd stop too?
I would just like to be sure I understand fully what the tradesim "rules" are and what it allows. for example, somehow the tradesim system picks up such terms as "entryprice." So can I then put "entryprice-3*ATR(1) or c<.88*hhv(c,20) "into the spot "optional stop" in the below module you provided?
{{{{ ExtFml( "TradeSim.RecordTrades",
"superoffhv", { Trade Data Filename }
LONG, { Trade Position Type }
EntryTrigger, { Entry Trigger }
EntryPrice, { Entry Price }
entryprice-3*ATR(1) or c<.88*hhv(c,20),{ Optional Initial Stop }
ExitTrigger, { Exit Trigger }
ExitPrice, { Exit Price }
START); { Recorder Control } }}}
5. the manual says that the tradesim program will not fully work in some instance if "it does not detect a valid inital stop"
Could you please give what criteria the tradesim program uses to make this determination of validity?
thank you very much, regards, geoffrey