iBankCoin
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
3,589 Blog Posts

On The Important Matter of Position Sizing (A Tale)

In wake of the multi-orifice TVIX skull fucking exposé here in the iBC_BN, I thought it time for a friendly reminder regarding position sizing. I hate to be brash and I never take schadenfreude in another trader’s hardships, but fuck (butt fuck?) come on people. We need not concentrate our money in these markets. You know…eggs in a basket. We learn that shit trolling church parking lots on Easter when we’re like five years old.

Everyone has a different percentage profile for how they concentrate speculative funds, but I guarantee a prop desk would fire your fucking ass if they saw you 75% allocated to an underwater leveraged ETF position. I got UVXY’d last week to the tune of a 28% loss. There I was, jogging at a casual eight minute mile pace in the park, banking coin long stocks, when a boy came walking from the jungle gym wearing UA shorts and a Dri-fit running shirt.

“Hey guy, you want a Gu Energy Gel? It will put some pep in your step. Finish hard brah.” smirked the athletic child. Charmed by the unsuspecting kindness of the boy stranger I agreed. He gestured to follow him to his “office” just inside the tree line behind the playground. He reached behind a makeshift blind and grabbed a heavy black garbage bag. His arms shook from the weight of the bag as he extended it to me. “Ga’head, the best ones are at the bottom.”

Puzzled and curious by the entire exchange I peered into the bag but was unable to see all the way to the bottom. As soon as I put my hand in the bag it erupted with action as a band of fucking rabid squirrels began slashing at my hand like a school of piranha. “Ouch bastard!” I cried out. And I pulled my hand out the bag and started running away.

“Shit sorry guy! The squirrels must have snuck in to steal the Gu packs. Die squirrls!” the menace yelled as he beat the garbage bag against a nearby tree. “They seem to have scurried off. Look they left all these Gu packs perfectly untouched. Come back!” he pleaded in a most innocent manner. But I had already made my way back across the playground, shoving several children to the ground as I sprinted through. His sinister laugh, more like a sick dog’s croon, faded in the distance as I continued my run through the park. I eventually made my way to a wash station and cleaned the hand up. It wasn’t until I returned home and my running endorphins subsided that I realized I had lost a finger in the exchange.

Had I been totally gay about running in the park and guzzling Gu packs that day I may have greedily reached in with both hands and been pulled into the bag only to have my bones picked clean by this evil fucker’s mutated war beasts. Did I mention the squirrels had switchblades and hand grenades? I live to run another day.

Moral: Don’t put 75% of your speculative funds in one place. Not even the 400% man does that shit with BRK-A. I most always top out at 15% concentration.

In the markets:  Initiated BID long.  Added to HFC

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