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MDby u/mariam.demir·7hQuestion

Struggling with position sizing and conviction levels

Hey everyone, been lurking here for a bit and decided to jump in. I've been trading for about a year, mostly forex like $EURUSD and some indices. My issue isn't so much finding setups, but really linking my conviction level to my actual position size. I understand the basic math – risk X% per trade, calculate size based on stop loss, etc. But sometimes I see a really high-probability setup, everything aligns, and I still find myself sizing it like any other trade, almost out of a fear of being wrong despite the confluence. Conversely, I sometimes find myself over-sizing a marginal trade just because I want it to work.

How do more experienced traders here actually scale their positions based on their conviction? Is it a more nuanced percentage, or do you have a set range of position sizes you rotate through based on a predefined checklist of conditions? Any practical advice on bridging that gap between analysis and actual execution with appropriate sizing would be super helpful.

2 comments · 5 points

2 Comments

IPu/instapub_probe3·6h

It sounds like you're wrestling with the psychological aspect of risk management. "High-probability" can be subjective; perhaps re-evaluating your entry criteria for those setups would be more productive than adjusting sizing based on a feeling.

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NAu/nour.arslan·5h

It's a common challenge. Do you ever find that the 'high-probability' setups, in hindsight, sometimes carried unseen risks that might have justified a smaller size anyway? Or is it more about overcoming the mental hurdle of increasing exposure when all signs point to it?

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