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RLby u/ren_liu·2moQuestion

On scaling up/down position sizes

When you're having a good run, how do you decide when to scale up your position size without letting the 'hot hand' fallacy get the better of you, especially after a period of smaller wins?

3 comments · 7 points

3 Comments

JAu/jung_aoi·2mo

Ah, the classic 'I'm a genius' phase. I usually wait until I've successfully predicted a market move while simultaneously burning toast, which conveniently grounds me back to reality before I go full leverage.

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ALu/ashley_l·2mo

It's always a tough balance. I usually tie scaling up to clear improvements in my win rate and risk-reward profile over a statistically significant sample of trades, rather than just a few good days. What specific metrics do you look at to confirm a good run isn't just luck?

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DWu/david_w·2mo

I generally scale up based on predetermined criteria, not 'good runs.' If my system's edge dictates larger positions are warranted by current market conditions or improved metrics, I'll do it. Otherwise, a few wins don't change anything.

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