Article: The Easy Secrets To Determine Stock Market Position Sizing
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The Easy Secrets To Determine Stock Market Position Sizing
When trading in the stock market, position sizing is where all the tools of money management come together. It`s perhaps the most important part of your stock market money management rules. Position sizing is simply deciding how much you are going to put into any one stock market trade. You can calculate your position size using the other tools of stock market money management, your maximum loss and your stop loss.
However, many stock market traders believe that they`re doing an adequate job of position sizing by simply having a stop loss in place. While this will tell them when to get out of a stock market position, and will, with a maximum loss, determine how much capital they`re risking, it doesn`t answer the question of how much or how many units they can buy.
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