Archive

position sizing

Jun 02 Amaranth and the Trade That Got Too Big A natural gas calendar spread is one of the cleanest trades in commodities. By September 2006, Amaranth's version of it was a large share of an exchange contract's open interest. That is not a position. That is a financing problem wearing a position's clothes. May 29 Larry Hite and the Bet Small Enough to Lose Larry Hite's risk lesson is simple and hard to live with: the trade has to be small enough that being wrong does not become the event. May 29 Captain Condor and the Defined-Risk Trap The reported Captain Condor wipeout was not just an options story. It was a reminder that defined risk can still become account risk when size keeps growing. May 28 Tom Basso and the Trade That Lets You Breathe Tom Basso's old lesson is not that trading should feel exciting. It is that the system has to be boring enough to survive the next 10,000 trades. May 27 The Turtle Rule Was Not The Breakout The famous Turtle entry gets all the attention. The trade only worked because size, volatility, exits, and boredom were part of the rulebook.