Turtles are what we call a group of traders trained by Richard Dennis and William Eckhardt in the most famous experiment in trading. I wrote a series of articles about turtle trading, the story behind Wall Street legend. In this article, we will learn more about the turtles, the techniques that made them millionaires.
A key [...]
Archive for the ‘Trading Money Management’ Category
How the Turtles Manage their Risk?
Posted by Taro on May 25th, 2010
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When to Begin Applying Money Management?
Posted by Taro on May 20th, 2010
Trader tend to believe that they do not need to address money management until they can prove that a particular trading system will work and they can make money using it. This is the most common areas for serious mistakes by traders and it is a costly mistake.
As I have always mentioned that a sound [...]
Money Management & Expectations
Posted by Taro on May 9th, 2010
As I have always said that money management is a component of a complete trading system. In this article, I will paint you a clearer picture on the effect of money management in trading. Furthermore the expectation of trading will brought to discuss here to see how it relates to money management.
In order to get [...]
Why Martingale Betting System Never Works in Trading?
Posted by Taro on May 2nd, 2010
I wrote some articles on martingale betting system and even provided an example of using martingale as money management system in trading from my experiences. Of course it made me lose. In this article, we will find the reason while it never works.
Firstly, let me explain what martingale is for those who have never heard [...]
Applying Martingale Betting System in Trading
Posted by Taro on April 7th, 2010
Martingale is a well-known money management system used in gambling. I used to talk about it before in one of my money management articles. This time I will confess to you my experiences of using the martingale system.
Risk of Ruin
Posted by Taro on April 3rd, 2010
The term Risk of Ruin in trading refers to the probability of losing entire trading account because of a string of losses.
For example if you are trading a futures contract, when you go long or sell the chances that the prices will move in the same direction as your opened positions is 50 percent. The [...]
Turtle Trading #5 Stops
Posted by Taro on March 18th, 2010
The critical piece of trading system is how to get out of a losing trade. Traders who do not cut their losses cannot be successful in long term.
The most important thing about stops that traders must keep in mind is to define the stops before enter a trade. This is of course not a coincidence [...]
Turtle Trading #4 Entries
Posted by Taro on March 15th, 2010
The next piece, following markets and position sizing, of turtle trading system is entries.
Most traders believe that entry is the most important aspect in any trading system. For the turtles, they used only a very simple entry system based on channel breakout systems taught by Richard Donchian.
The turtles’ rules for entry consist of two different [...]
Turtle Trading #3 Markets and Position Sizing
Posted by Taro on March 11th, 2010
Markets and Position Sizing are pieces of turtle trading system.
The first thing traders have to know is what to buy or sell.
The original turtles were commodities traders. They traded futures contracts on most U.S. commodities exchanges. The primary criterion that the turtles used to determine which markets could be traded was liquidity. Since the turtles [...]
The 2% – 6% Money Management Rules
Posted by Taro on August 4th, 2009
The greater staying power of traders the greater chance to win. Traders have to stay in markets long enough to win trades. Money management plays an important role in helping traders to survive in markets.
No one win every trades; money management help traders to reduce losses on losing trades. Moreover it also maximizes traders’ gains [...]
