Tuesday, December 22, 2009
You must take extra care while increasing trading quantity. More often than not, novice traders, recklessly increase trading size and lose the small amounts gained in a few lucky trade. The reasons for taking cautions are mani-fold:
* - Psychological pressure of potential, bigger losses and hence not keeping enough stop loss.
* - Cost of slippage is usually higher
* - Blotter looks ugly when in drawdowns
Make sure you increase quantity gradually.
Measure performance by comparing with a set benchmark, even against smaller size trade results.