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• Fixing The Flaws In Fixed-Fractional Position Sizing by Christian B. Smart, PhD

  ARTICLE SYNOPSIS ...Fixing The Flaws In Fixed-Fractional Position Sizing by Christian B. Smart, PhD Fixed-fractional position sizing is a time-tested method for money management, but in the long run, it will never achieve system expectancy. Here's how you can fix this flaw. Fixed-fractional position sizing is a popular and time-tested method for money management. In the strategy, a fixed percentage of equity is risked per trade. The formula is given here as: Amount risked per trade = Equity * f where f is the fixed percentage of equity risked per trade. Fixed-fractional money management is an intuitive method i...

AUTHOR: Christian B. Smart, PhDDATE: AUG 2007SUBJECT: Money Management