Understanding Position Sizing in Energy Trades

When trading commodities like WTI, position sizing isn't just about how much you're willing to lose, but how you manage your capital against market volatility. A common mistake is using a fixed dollar amount per trade, which doesn't account for varying price ranges or your overall portfolio. A more robust approach considers a percentage of your total equity, allowing your position size to scale with your account balance and the specific risk profile of the commodity, rather than just chasing points.