Making Money
Management Decisions
The goal of money management is to break even.
—Charles B. Goodman
Management Decisions
The goal of money management is to break even.
—Charles B. Goodman
Money management is neither sexy nor easy to come to grips with for
most of us.
Because money management crosses over between trading tools and
style, it is always somewhat subjective. It is almost a soft element, but it is possible
to build a hard money-management framework. The trading campaign framework
I discussed in the previous chapter is such an idea. As long as the trader doesn’t
stray from the framework, ad hoc and subjective decisions are possible without
causing too much trouble. The markets are enormously dynamic and change is
necessary. The key is to keep changes evolutionary instead of revolutionary.
most of us.
Because money management crosses over between trading tools and
style, it is always somewhat subjective. It is almost a soft element, but it is possible
to build a hard money-management framework. The trading campaign framework
I discussed in the previous chapter is such an idea. As long as the trader doesn’t
stray from the framework, ad hoc and subjective decisions are possible without
causing too much trouble. The markets are enormously dynamic and change is
necessary. The key is to keep changes evolutionary instead of revolutionary.
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