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How I size positions: risk management that survives drawdowns

24May 17, 2026

Ask a losing trader about entries and they will talk for an hour. Ask them about position sizing and you get silence. Sizing is the part of the system that decides whether a losing streak is an inconvenience or an account reset.

The formula I use

I risk a fixed fraction of the account per idea, defined by the distance to invalidation, never by conviction. Conviction is a feeling; invalidation is a price. When the two disagree, the chart wins. That one rule has saved me more money than any indicator I have ever used.

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