Position Sizing: How to Increase Trading Profits With This Effective Trading Technique

Position sizing Strategies are vital to a day traders success. In this video, an SMB Trader shares his newly built position sizing system to make significantly more, much much more, in a technical analysis trade.
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[@SoveriegnIndividual]

Fantastic vid guys!!! One of my all time favs that you guys have done!

[@modousow8832]

I admire this trader’s Passion!

[@trevorking708]

Amazing video! thank you for putting out such great content!

[@smbcapital]

Thanks Trevor!

[@alantuchman6465]

Another great video. You won't find many trades better that this one. Had all the characteristics, plus they had insider selling. Appreciate the tips as always. Actually in the middle of reading one of your books. Thanks again...

[@alexandermoise6985]

Whats helped my psychology tremendously and made me a better trader is not going into the markets with the objective to make money but to leave the day better whether I lose or win. Try to fall in love with tracking statistics and working on your physical and mental health. " Success is when preparation meets opportunity"- Bill belichick Again Thankyou SMB for helping the retail traders

[@CarftCrO0K]

Focusing on the execution of your trading plan and how good you are at executing it is more important than focusing on your returns - and will more than likely push you to improve too

[@mbellafiore19]

Alexander Moise maybe Coach got that from Oprah? Thxs for contributing Alexander

[@jcbsantos]

could you please make one for the filters, that's something I'm interested on how you evaluate and screen.

[@mbellafiore19]

okay

[@gauharsingh7015]

Would it be possible to discuss more about the fundamentals for developing filters ?

[@mbellafiore19]

sure

[@adiisaacadiele762]

I am also interested in this as well Mike.

[@CarftCrO0K]

Always enjoy these videos, rather interesting how this could probably work also with bonds and FX, wonder if he has backtested this strategy on those markets too

[@mbellafiore19]

Max Sydney we didn’t but good thinking for you to test if you focus on this markets.

[@edriley3240]

Thannks Mike another great educational video

[@mbellafiore19]

Ed Riley you bet Ed

[@smbcapital]

Thanks Ed!

[@Earth67Mars48]

The trader did an overall great job. No matter what pursuit we are in, many of us feel as they though we can do better. Hindsight is telling you that you should have believed more in the back tested filter. What percent has that filter been right? The fear of losing - after initially making a win - is a strong emotion.

[@user-fu2bt7yq7q]

In this case the catalyst was just the best you can imagine. And for adding risk system I understood that you should: 1) look at different time frames (1,2,5,15min...); 2) Think: "If I hadn't entered earlier, would I enter right now like it was my first entry?". If the answer is "No", do not enter, you are still having a position and still have profits, nothing terrible if you didn't enter right before a move, it's not a guessing game. If the answer is "Yes", go for it. It doesn't meen that you will always be right, but you'll always do what is right to do; 3) Find the entry where you can set your stop that would make SENSE. By that I meen that If a price reaches your stop it will most probably not go in the direction of your position. For example: If you want to short ROKU betting on it to break a consolidation and continue its trend, you set a stop at the high of this consolidation and if you are stopped out, ROKU will NOT break this consolidation in a nearest time and you won't feel dissapointed that you are stopped out before a big move in your direction. These are just my thoughts and I don't know whether they are completeley right. Looking forward to Mike's feedback! Thank you for another great video!

[@mbellafiore19]

Дмитрий Усов I like the idea of a real stop where you are definitely wrong for stops for most positiins

[@brylittrean]

how many average days do you guys use when getting your rvol? 20, 30, 60?

[@misstinytrader88]

I will keep working on all of the above.

[@mbellafiore19]

very nice Tiny!

[@smbcapital]

Let us know how it goes!

[@jetal0]

Great video thanks for sharing. Maybe a silly question but I am having trouble finding free daily RVOL data on any given stock. I don't think think or swim offers this stat. Does anyone know?

[@mbellafiore19]

Jason yes TOS offers

[@misstinytrader88]

Great explanation of your plan and why you traded it that way. How do I know if my vwap is correct? Is there a specific setting for it? I use Think or Swim and it shows a -2.0,2.0, Day setting. Is this what you all use or can I adjust it?

[@mbellafiore19]

we use proprietary software

[@misstinytrader88]

@@mbellafiore19 makes sense. Thank for replying! I have learned greatly from you! I have One Good Trade on order 😀

[@mbellafiore19]

@@misstinytrader88 really love hearing that!

[@gauharsingh7015]

I realised that I have been missing out on size evaluation, going to make sure I work on that next as now I have a decent amount of data on the r:r and success rate of my best trades

[@mbellafiore19]

good idea

[@mikebasketball11]

Fantastic, how long did it take you to gather such data over how many trades roughly? All the best wishes Gauhar :)

[@gauharsingh7015]

@@mikebasketball11 it usually depends on the specific trade, some occur almost everyday and some once in a few months , considering that trades do stop working eventually I wait for more data for the frequent, lower risk:reward and faster execution trades, my methods are very subjective so that number is based on the confidence I have on each specific trade setup

[@husainsaify6253]

Sir, If you could please help me with the filter to set for big mover setup , If you could discuss that , It would be helpful , Only understood the rvol , what other variables needs to be put in the filter ?

[@simonhuber6859]

Can I get this size increase punchcard somewhere you mentioned in "The Playbook"?

[@AnthonyBordignon]

what would you recommend for a program that would give the Beta, ATR, Rvol, ETC

[@modousow8832]

Anthony Bordignon Trade Idea $115/month. Or finviz (free). Best of luck

[@MrJigga420]

Tradingview.com

[@georgemcduffey2622]

I'm from the year 2021. ROKU investors no longer fear Apple or Comcast here:) I like the idea of the "Risk Addition Parameters Chart". I've been trying to get better at being bigger in my A set-ups, but, it's backfired a couple times. Being more graduated should help. Maybe having a tighter stop on the added size (if there's a good level for it) could help reduce the risk of adding risk...Something to work on...

[@adiisaacadiele762]

How did he conduct his back testing? Is it with an in-house software provided by SMB Capitals?

[@farzad3578]

You may check out Quantopian as well.

[@caligirl6610]

I need to build a sizing up system for my A quality set ups. I leave money on the table that way.

[@huntfortrades6883]

Great video

[@smbcapital]

Thanks!

[@eliasweber7460]

8:00 I also didnt think there would be high enough risk reward to the downside due and maintaining a tight stop was tough due to the spread. This one ran without me

[@eightbo]

This trader used 20% of his Daily Stop on this trade. Here's a note from my Journal today with regards to sticking to Daily Stops: "Key Insight: I really like viewing my current balance/P&L as unrealised profits and unrealised losses. It means that instead of being focused on where my profit and loss was in the past or where it is currently (and trying to get back to highs as soon as possible), I'm accepting that where it'll end up at the end of the session (future) is unknown which keeps my focus on proper trade execution in the next trade. And if I don't like where my P&Ls going or where it MIGHT be going for a session or day (e.g. start to log consecutive trades where I'm unable to follow my rules; or if I become noticeably tired), I can Cease Trading in the same way I'd close a vulnerable trade."

[@mbellafiore19]

­ eightbO good insights in your journal

[@TradingProT]

Sir I have one serious doubt in position sizing. Ex - My capital is 100000 Risk on capital 2% I.e 2000 Buy entry @1000 Sl @990 Diff 10 So, 2000/10 =200. But how can I proceed with it if as per position sizing qty is 200*buyrate is 1000= buy value becomes 200,000. If my capital is 1 lac and buy value as per position sizing comes to 2l...it's not matching...am I missing something here

[@Leploit]

Leverage: if you have x2 leverage, you can buy those 200 shares.

[@givenesstshimomo8875]

creating a system for sizing on those A+ setups

[@sabahtaha5888]

Quite informative on roku but keep it simple: bearish news catalyst + parabolic+ broke uptrend= major down side

[@ehudkrispil]

I will put more effort on develope a position sizing system for my A+ technical trades

[@mbellafiore19]

Ehud Krispil noted

[@isabelle8084]

what does ATR stand for?

[@diogosilva2475]

This video is overwhelming because most of us have been there: the opportunity is big but we have to take uncomfortable risks.

[@MrJigga420]

No fear my friend, take the setup and keep cash on the side...if it doesn't go your way dont cling to it. Just cut it off at "x" %

[@MrJigga420]

I just check the daily for a strong signal, and then dissect it on a smaller timeframe (5-15m)

[@Reotha]

Build a custom filter

[@mbellafiore19]

noted.

[@gao2737]

I'd say you'd better to add more risk to your A+ setups, which means you are a master of those setups. You didn't add more size because you are not familiar with this setup and you don't know how to manage the risk. Therefore, be careful to use your 'position size system'...

[@mbellafiore19]

Feng Thxs for sharing

[@misstinytrader88]

I am getting better at reading the tape and have been saved large losses as a result. Still stuck to paper trading and learning tons every time I trade.

[@smbcapital]

Keep up the good work! paper trading is always a good idea to help build up your confidence

[@DM-qq7cr]

How i measure RVOL for a stock ? , lets say the avarage volume is 1mil and today volume is 3 million , how much will be the RVOL worth?

[@mbellafiore19]

FOMO www.smbtraining.com/blog/relative-volume-rvol-defined-and-how-we-use-it

[@sabahtaha5888]

Trade stocks that u follow intimately

[@Firstmajortomlikestoticker]

Build a Filter

[@herrickinman9303]

There's no need to make the analysis so complicated or resort to fundamental analysis, All you had to do was pay attention to the rising channel on the ROKU daily, determined by the swing lows on 12/24/18 and 4/18/19 and the swing high on 10/2/18. On 9/4/19 ROKU closed around 169, above rising channel resistance. On 9/9/19 ROKU formed an outside bar to the downside that closed around 161, below rising channel resistance. By 9/10/19 ROKU closed around 144. Between 9/10/19 and 9/17/19 ROKU formed a contracting bear flag on declining volume. (Elliott wave 2) By 9/20/19 ROKU had sold off to the 8/16/19 swing low support at 127. and formed an inside bar. (Elliott wave 4) By 9/27/2019 ROKU had sold off to the bottom of the channel, closing around 100.

[@williamamodeo1197]

I notice a lot of your videos that you focus on fundamentals first in almost every single one. I guess it’s more than just basic TA. It’s layering your probability in your favor with multiple talking points.

[@smbcapital]

yes fundamentals are important. Stocks with a news catalysts combined with TA can give us high probability trade setups

[@williamamodeo1197]

@@smbcapital Awesome stuff. I will be joining you soon.

[@nicklam66]

dam u got skinny pops

[@donatastaraile784]

Position sizing in this example is bullshit with crappy rationalization.

[@guardalo123]

what is the noise in your video? are you in a zoo? why dont you get a normal job? is it soo hard for you to work?

[@itslike123]

Your videos too long and too much out of topic