A Trader's Money Management System: How to Ensure Profit and Avoid the Risk of Ruin

Foreword vii

Preface ix

Acknowledgments xi

Diclaimer xiii

INTRODUCTION This is My Money Management System 1

PART ONE Psychology of Risk Control 7

CHAPTER 1 It Just Ain’t Sexy! 9

CHAPTER 2 Confidence in Your Plan 15

CHAPTER 3 Yin and Yang 23

CHAPTER 4 Risk Psychology and The Trader’s Mindset 31

PART TWO Stop-Loss Exits 37

CHAPTER 5 Not Every Trade Will be a Winner 39

CHAPTER 6 Entry Rules and Your Trading System 45

CHAPTER 7 Stop-Loss Exit Rules 55

CHAPTER 8 Scaling Out and Scaling In 65

PART THREE Trade Size Does Matter 73

CHAPTER 9 Using Risk-of-Ruin Tables and the Optimal f Formula 75

CHAPTER 10 Using the Two Percent Risk Formula and Proper Trade Size Formula 83

PART FOUR Record Keeping and Profit/Loss Analysis 89

CHAPTER 11 Tracking Profit and Loss Results and More Formulas for Success 91

CHAPTER 12 Using Trade Posting Cards and Ledgers 99

PART FIVE Design Your Own Plan 131

CHAPTER 13 Know Thyself—Your Risk Profile and Discipline Profile 133

CHAPTER 14 Risk Management Rules to Choose From 139

Epilogue 149

APPENDIX A Getting Started with Your Trade Size Calculator Software 151

APPENDIX B The Trader’s Assistant Record Keeping System 153

APPENDIX C The Art of Paper Trading 167

APPENDIX D Resources 173

Glossary 179

About the Author 203

Index 205