£4800 banked today – Friday’s live trading video…
A number of positions running into today. A good example of being diversified and then just trading light into the end of the week…
A number of positions running into today. A good example of being diversified and then just trading light into the end of the week…
6 Comments
Hi Charlie,
Firstly, do you use a live news squawk during the day?
Secondly, what are your views on money management – do you always risk a set proportion of your capital e.g 1% or does it depend on your gut feeling / confidence on a particular trade?
Cheers.
Manoj.
Hi manoj. No I don’t use any squawk feeds as that is not my style trying to catch rapid moves. I tend to trade once the technicals are all aligned for me so a squawk has no use. I vary position size per trade depending on the grade that I have for that particular trade.
When you buy 50k to close half the position, aren’t you paying the spread again? Seems kinda pointless to me?
It’s the only way of banking half on this platform but with a spread of 0.7 it’s hardly something to worry about
It adds up, doesn’t it? I’ll assume you’re with Saxo bank (based on your twitter feed) so let’s say I have a £10k account. Saxo’s spreads are generally quite low, but they usually charge some commission fees here and there so let’s assume EUR/USD has, on average, a total transaction cost of 1 pip. So closing half a 100k position means you’re paying a 1 pip spread on 50k units for each half of the position you close. That equates to £5.
Now if you’re a daytrader you might take about 8 setups per day, so let’s say four of those include closing positions at half. That means you’re effectively paying £10 to fully close such a position and if you have 4 of those per day that means you’re looking at £40 per day, which is 0.4% of your £10k account. Even if you had £50k in your account and were only using 2:1 leverage (i.e. trading 100k unit positions), £40 per day would be something like a fraction of your account which over the course of a month certainly adds up, eating away at profits.
Although I may just be speculating and pulling numbers out of my behind but really wanted to share my thoughts on it. I respect the fact that you have a different understanding and opinion about it and that’s fine.
I think you are over analysing this. Yes you have a point but I don’t do 8 trades a day and generally I plan ahead for taking partial profits by getting a separate number of lots in. Sometimes I haven’t allowed for that as per Friday hence why it’s no issue.