3D·

There are old traders and there are brave traders. But there are no old, brave traders! 📈📉📈📉📉

What is this quote trying to tell us?

As always, this topic is aimed at anyone interested in trading. The rest just keep scrolling. Although after the last week with some extreme drawdowns, it may also be of interest to some B&H investors 😅

Source of the picture: YouTube Mind Math Money

What are my reflections from my trading journal?

For the TL;DR my conclusion first:

The optimal position size is not the one that mathematically promises the highest profit. It is the one at which you psychologically stable, disciplined and clear remain!

Because in the end, it's not the bravest trader who wins. It's the one who stays in the game long enough.

In the course of my trading posts, someone asked me last year: https://getqu.in/cbIOkg/

"If you have an 80% win rate, why don't you just increase your position sizes? Then you would earn a lot more!"

A legitimate question, it sounds logical. Mathematically even absolutely correct. Pretty much at the same time as this question, I also started to raise my upper limit from 10k per trading position to 15k and later 20k last year. It worked, but I didn't feel comfortable. Something has changed. I couldn't put my finger on it at the time, but I felt it: These 20k positions are doing something to me.

In Q4 2025, I then consistently went back to around 10k per position. My absolute profit in euros was no higher in the end, despite larger position sizes.

Today I stumbled across a YouTube video that describes exactly what I intuitively felt at the time. I can recommend it to anyone interested in trading!

The core message is simple, but extremely important:

Position size doesn't determine your profit, it determines your psyche.

The following happens above a certain size:

You you lose the ability to think clearly ("the ability starts to disappear").
You no longer trade the market, you trade your account.
Discipline fades into the background.
Trading becomes less of a probability game and more of a psychological psychological stress management.

Mark Douglas, whose book is also quoted in this video, sums it up perfectly:

"The market is a probability environment. Your brain is not designed to operate calmly when too much is at stake."

Link YouTube https://youtu.be/yWOviauHmT8?si=_AQpcXk5URZ2ZmbT

The matching book recommendation: "Trading in the Zone" by Mark Douglas

$IREN (-6.36%)
$RDW
$ZETA (+0.7%)
$AMZN (-0.7%)
$MSFT (+0.07%)

#trading

13 Comments

HODL-Humpy🐪@HODL-Humpy

Thanks for the post, can also say something briefly about this. I've noticed something similar with my normal positions, i.e. the ones I've held for 1-2 years or longer, depending on how they develop.
As with swing trading or buy&hold, there is also the risk appetite that you should know and where you feel comfortable and it makes sense.

For the last 3-4 years I've had around 5K positions in individual stocks.
This year I opened a larger position. Over 20k in one position.

I don't feel nervous or worried (or so I thought)- but something has changed and there is a new feeling that I haven't experienced before.
Of course, this week was the best example of this - it went down a lot. But even weeks like that are part of it and then maybe it shows you that it can trigger some nervousness that you didn't know before.

I still feel comfortable with it, but you can tell that it does make a difference. 🙏🏼

•

TomTurboInvest@TomTurboInvest

@HODL-Humpy As you say, you have to feel comfortable. This limit is different for everyone and also changes over time.

When trading, for example, regular losses are normal and should not be a burden. As long as the setup is right, these are "expenses" that are part of it. I noticed that once I reached a certain size, I suddenly started thinking more about these losses and they led me to start "tweaking" my setup. The absolute amount was suddenly in the foreground, and it should actually be order flow and price action, simply the strategy traden🤷‍♂️

You can see the difference between "paper trading" and when it comes to real money.

Years ago, I started with €500 positions, which has now leveled off at around €10k with active trading.

•

HODL-Humpy🐪@HODL-Humpy

@TomTurboInvest Yes, that's right, as you say, with trading I know beforehand that losses are also part of it - if you don't feel comfortable with them, you shouldn't even try it at all - or slowly feel your way around. The stock market is not a one-way street. You have to know this or learn it. Making losses is part of it.

As you have nicely described: if the stakes get bigger and then emotions get involved and you try to change the setup you have, you should question whether it is the right thing for you to buy such a large sum. That is one of the most important things and what makes you successful. Using your system and having clear rules, even if it goes down. Of course sometimes there is something to change or optimize but not because of feelings. Very nicely described by you....

•

Tom M.@Lumimyrsky

I can confirm this 100%. I reduced my leverage and position size and my win rate increased. Entry and exit also became much better. The psyche simply plays the most important role

•

TomTurboInvest@TomTurboInvest

@Lumimyrsky I can well imagine that many traders can relate to this topic. If it suddenly becomes "stressful", you should change something.

•

Tom M.@Lumimyrsky

@TomTurboInvest yes 100% but if it continues to go well I have to see how I do it with position size again, I think that should work because I will not increase leverage anymore

•

TradingHase@TradingHase

I have had my limits for certain positions for a long time, which I do not increase. I feel very comfortable with this.

•

TomTurboInvest@TomTurboInvest

@TradingHase Gut so 👍
Don‘t touch a running system!

•

Christoph@ChrisBizz

Very interesting and instructive, also the comments 👍🏻

•

TomTurboInvest@TomTurboInvest

@ChrisBizz Thank you for your feedback!

••

Patrick Schäfer@Hotte1909

I can only confirm that. Especially in trading, I quickly feel uncomfortable with positions over 20k. This is actually rarely the case with my normal positions. However, I also sold Rocket Lab twice when the position jumped above 200k.

•

TomTurboInvest@TomTurboInvest

@Hotte1909 B&H certainly has different limits, but you have to feel comfortable there too. Days like last Thursday can otherwise be very painful 😅
With my large B&H position, I already have SL levels for myself, where I then start with partial sales. Otherwise it can quickly become a case of "easy come, easy go".

••

Darkwingduck@Darkwingduck

Orr worked great again today. At $AMZN 😁

•