Risk and Portfolio

Managing risk across a whole system — position sizing, drawdown limits, correlation between strategies, and combining several strategies into one book.

What you will be able to do

Set risk per trade and portfolio limits from a drawdown budget.
Measure correlation between strategies and its effect on combined drawdown.
Compare sizing methods, including fixed fractional and volatility targeting.
Write kill-switch rules before a strategy goes live.

Planned lessons

1
Risk per trade and the drawdown budget
Working backwards from the drawdown you can tolerate to the risk you take per trade.
Coming next
2
Volatility targeting
Scaling exposure so that each position carries comparable risk.
Coming next
3
Combining strategies
Correlation, diversification, and reading a combined equity curve.
Coming next
4
Kelly, fractional Kelly and their limits
What the Kelly criterion says, and why most traders use a fraction of it or none at all.
Coming next
5
Kill switches and risk limits
Written rules for pausing a strategy before emotions make the decision.
Coming next