Ed Seykota’s Trading Style Part-III

In Continuation with previous 2 article
Ed Seykota’s Trading Style Part-I
Ed Seykota’s Trading Style Part-II
Risk Below 5% of Equity Per Trade

• I intend to risk below 5% on a trade, allowing for poor executions. Occasionally I have taken losses
  above that amount when major news caused a thin market to jump through my stops.
• Risk no more than you can afford to lose, and also risk enough so that a win is meaningful. If there is no such amount, don’t play.
• Speculate with less than 10% of your liquid net worth. Risk less than 1% of your speculative account on a trade. This tends to keep the fluctuations in the trading account small, relative to net worth. This is essential as large fluctuations can engage Fred and lead to feeling-justifying drama.
• Betting more boldly produces more volatility. Good traders are familiar with both and keep their trading well within their tolerances.
• I use a rule of thumb that you place less t

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