039: Michael Cook discusses position sizing to maximise returns, using the market to determine stop levels and the role of discretion in systematic trading.
Better System Trader
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Is There a Way to Reduce a Stop Loss?
You always want to have one, but you don't really want that to be the stop that actually takes you out of trades. Well, i've thought about thiselas, there's a very simple solution to that. Just take the trades that that have the, say, sub 300, a 300 dollar stop loss, and triple your size. You're still running the same risk level, but you've suddenly tripled your size. Of course, your potential upside has massively increased. But what it is is, if you can market define stop points and then just take the trades, whereby your stop level is much smaller than you can ratch up size and sizes in what makes you the money
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