A Trader’s Money Management System

Money management may very well be the most important piece of the trading puzzle. In A Trader's Money Management System, expert Bennett McDowell provides time-tested techniques that can turn a losing trader into a winning one?and take the winning trader to an entirely new level. In revealing his personal approach to staying out of trouble in the financial markets and maximizing profits, he offers comprehensive insights into: The psychology of risk control as well as the finer aspects of setting stop-loss exits The value of managing trade size and consistent record keeping The process of putting together your own personal money management system Unlike other books that focus on the complex mathematical theories behind money management, this book presents its system in straightforward, easy-to-understand terms that will allow you to quickly see how these concepts work and immediately benefit from the value of effectively managing risk.

Money management may very well be the most important piece of thetrading puzzle. In A Trader's Money Management Systemexpert Bennett McDowell provides time-tested techniques that canturn a losing trader into a winning one?and take the winning traderto an entirely new level. In revealing his personal approach tostaying out of trouble in the financial markets and maximizingprofits, he offers comprehensive insights into:* The psychology of risk control as well as the finer aspects ofsetting stop-loss exits* The value of managing trade size and consistent recordkeeping* The process of putting together your own personal moneymanagement systemUnlike other books that focus on the complex mathematicaltheories behind money management, this book presents its system instraightforward, easy-to-understand terms that will allow you toquickly see how these concepts work and immediately benefit fromthe value of effectively managing risk.

Foreword viiPreface ixAcknowledgments xiDiclaimer xiiiIntroduction This is My Money Management System 1Part One Psychology of Risk Control 7Chapter 1 It Just Ain't Sexy! 9Chapter 2 Confidence in Your Plan 15Chapter 3 Yin and Yang 23Chapter 4 Risk Psychology and The Trader's Mindset 31Part Two Stop-Loss Exits 37Chapter 5 Not Every Trade Will be a Winner 39Chapter 6 Entry Rules and Your Trading System 45Chapter 7 Stop-Loss Exit Rules 55Chapter 8 Scaling Out and Scaling In 65Part Three Trade Size Does Matter 73Chapter 9 Using Risk-of-Ruin Tables and the Optimal f Formula 75Chapter 10 Using the Two Percent Risk Formula and Proper Trade Size Formula 83Part Four Record Keeping and Profit/Loss Analysis 89Chapter 11 Tracking Profit and Loss Results and More Formulas for Success 91Chapter 12 Using Trade Posting Cards and Ledgers 99Part Five Design Your Own Plan 131Chapter 13 Know Thyself--Your Risk Profile and Discipline Profile 133Chapter 14 Risk Management Rules to Choose From 139Epilogue 149Appendix A Getting Started with Your Trade Size Calculator Software 151Appendix B The Trader's Assistant Record Keeping System 153Appendix C The Art of Paper Trading 167Appendix D Resources 173Glossary 179About the Author 203Index 205