I finally got around to reading about the blowup of Amaranth Advisors hedge fund. I’m astounded that some of these supposedly sophisticated hedge funds apparently have no clue about such basic concepts like money management, position sizing and ‘risk of ruin‘. The disaster at this fund is a great illustration of why I’ve always said [...]
Posted by 5 September 2006
Position Sizing Q & A
Here are my responses to the comments left on last week’s “position sizing considerations” post: nonadamas wrote: 1. What about equipment, ISP failures, do you always write down your trades? 2. What kind of backup set-up do you have? 3. Brokerage problems, problems at their site or with their people making errors? When I started [...]
Posted by 1 September 2006
Position Sizing Considerations
Posted by 10 June 2006
My Position Sizing Spreadsheet
The other day Marcos asked where he could find a position sizing spreadsheet. I just uploaded mine in case anybody else wanted a copy. It’s nothing fancy at all and it’s based on the percent risk position sizing model. Just enter your account equity and the amount you want to risk per trade (expressed as [...]
Posted by 28 April 2006
