Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You've been tracking your trading performance and wish to determine the expectancy from a trade you are planning. Assume you have $200,000 and wish to

image text in transcribed
You've been tracking your trading performance and wish to determine the expectancy from a trade you are planning. Assume you have $200,000 and wish to risk 1.50% on the trade and plan to place an 8% stop loss. The security you are following is trading at $75. Assume that you win 50% of the time and have a gain of 12% each win. When you lose, you lose 8%. How much of your $200,000 portfolio do you invest (position size)? \begin{tabular}{|l} \hline$35,000 \\ $37,500 \\ $20,000 \\ $40,000 \end{tabular}

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financing California Real Estate Spanish Missions To Subprime Mortgages

Authors: Lynne P. Doti

1st Edition

184893601X, 978-1848936010

More Books

Students also viewed these Finance questions

Question

2 The main characteristics of the market system.

Answered: 1 week ago