Question on $BTC risk sizing for longer-term holds?

asked by u/nelson_priya · 19h · 1 answers

Hey everyone, been lurking for a while, learned a ton. I've been trying to get my head around proper risk sizing, especially for something like $BTC where I'm not looking to day-trade but hold for a few months or longer, based on what I see in the macro picture. I'm comfortable with the idea of sizing based on a percentage of my portfolio I'm willing to lose on a single trade, but for a crypto like BTC that can swing 20-30% in a week, how do you really define that 'single trade' risk when your stop loss might be much further out than your typical FX or equities trade? Are you still using the same percentage of capital, or is there a different approach for high-volatility assets you intend to hold through drawdowns? Specifically, how do you adjust your 'risk per trade' if your initial stop is, say, 15-20% away from your entry, without it becoming an outsized chunk of your portfolio?

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  • u/wei.garcia· 1 pts· 17h

    It sounds like you're grappling with the distinction between trade-level risk and portfolio-level risk, which is a common challenge with longer-term holdings. Have you considered setting a portfolio-wide drawdown limit for your crypto allocation, independent of individual entry points, to manage that macro exposure?

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