{"product_id":"stcov253fifl","title":"Stocks \u0026 Commodities V. 25:8 (32-34): Fixing The Flaws In Fixed-Fractional Position Sizing by Christian B. Smart, PhD","description":"Fixing The Flaws In Fixed-Fractional Position Sizing by Christian B. Smart, PhD\u003cbr\u003e\u003cbr\u003eFixed-fractional position sizing is a time-tested method for\nmoney management, but in the long run, it will never achieve\nsystem expectancy. Heres how you can fix this flaw.\u003cbr\u003e\u003cbr\u003eFixed-fractional position sizing is a popular\nand time-tested method for money management.\nIn the strategy, a fixed percentage of\nequity is risked per trade. The formula is\ngiven here as:\nAmount risked per trade = Equity * f\nwhere f is the fixed percentage of equity risked per trade.\nFixed-fractional money management is an intuitive method\nin which bet size increases when equity increases and bet size decreases when equity decreases. This form of money management\nis conservative in that it dramatically decreases risk\nof ruin.\u003cbr\u003e\u003cbr\u003eA concept related to money management is system expectancy.\nA systems expectancy is the average, or expected,\namount of money an investor expects to make per dollar\nrisked. For example, a trading system with a winning percentage\nof 40%, whose average win is equal to twice the average\nloss, has an expectancy approximately equal to 0.40 * 2 0.60\n= 0.80 0.60 = 0.20.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134128484721,"sku":"\\V25\\C08\\151SMRT.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_985ebe67-d4a0-42bb-a98b-582c9f665453.jpg?v=1739667795","url":"https:\/\/shop.traders.com\/products\/stcov253fifl","provider":"Stocks \u0026 Commodities","version":"1.0","type":"link"}