Why did my friend lose 1 million dollars cash this year thanks to Brazil? The HUGE Lesson learned

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(Last Updated On: October 31, 2014)

Why did my friend lose 1 million dollars cash this year thanks to Brazil? The HUGE Lesson learned

I don’t think he applied the logic below but he was an experience pro day trader. This is his second HUGE losing trade.

First, learn when to cut losing trades fast but I wrote about that before! But read this to understand awhy very few people talk about it.

The last step of this trading system is up on me. Money allocation management for each pair trade

This is the last step to the whole puzzle I am working on. It is also the last piece but 1 needs to understand how much to allocate to each trade on the long and short. It depends on the market view, risk tolerance, and the beta of stock performance against your total portfolio. There are a number of factors that need to be considered including the market sensitivity you are trading. Your trade could easily become capital hungry which can lead you down the wrong path of losing. LOSING BIG TIME!

He was also tied emotionally to the trade that destroyed but thanks to automated trading, that should never happen since it calculates based on data and programming logic.


Be on the look out for a new video on this topic with software scripts that will take care of each position put on with risk tolerance built in to allocate the proper weight to each new trader. My new Quant Elite service will get unique content on this!

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NOTE I now post my TRADING ALERTS into my personal FACEBOOK ACCOUNT and TWITTER. Don't worry as I don't post stupid cat videos or what I eat!
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About caustic

Hi i there My name is Bryan Downing. I am part of a company called QuantLabs.Net This is specifically a company with a high profile blog about technology, trading, financial, investment, quant, etc. It posts things on how to do job interviews with large companies like Morgan Stanley, Bloomberg, Citibank, and IBM. It also posts different unique tips and tricks on Java, C++, or C programming. It posts about different techniques in learning about Matlab and building models or strategies. There is a lot here if you are into venturing into the financial world like quant or technical analysis. It also discusses the future generation of trading and programming Specialties: C++, Java, C#, Matlab, quant, models, strategies, technical analysis, linux, windows P.S. I have been known to be the worst typist. Do not be offended by it as I like to bang stuff out and put priorty of what I do over typing. Maybe one day I can get a full time copy editor to help out. Do note I prefer videos as they are much easier to produce so check out my many video at youtube.com/quantlabs