Discretionary Trading

There are some great conversations in the comments to the previous post. The last question was:

El, per your stat, how many contracts, say on euro futures do you trade per $30,000?

As an example, 1 contract per $10,000, i e 3 contracts per $30,000?

Can you expand a bit on what you beleive is a "proper" account per so many contracts?

 The answer depends on many things including: Are you CP? What your win rate is. What your average trade size is (the average of all wins and losses). Your risk per trade and so on. In other words, how many contracts can you trade without wiping out your account. Making this assessment is crucial if you want to trade aggressively or even passively. Once you have this number then it should be reduced to half, to a quarter or even less depending on your degree of aggression.

All of this depends on having comprehensive back testing stats with a large enough sample size to be relevant. The back testing is not only to validate you as CP but also to provide the information for proper position sizing.