ART Trading – Bennett McDowell – A Trader’s Money Management System
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ART Trading – Bennett McDowell – A Trader’s Money Management System
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Money management may very well be the most important piece of the trading puzzle. In
A Trader’s Money Management System, expert Bennett McDowell provides time-tested techniques that can turn a losing trader into a winning one and take the winning trader to an entirely new level. In revealing his personal approach to staying out of trouble in the financial markets and maximizing profits, he offers comprehensive insights into:
- The psychology of risk control as well as the finer aspects of setting stop-loss exits
- The value of managing trade size and consistent record keeping
- The process of putting together your own personal money management system
Unlike other books that focus on the complex mathematical theories behind money management, this book presents its system in straightforward, easy-to-understand terms that will allow you to quickly see how these concepts work and immediately benefit from the value of effectively managing risk.
Table of Contents
Foreword vii
Preface ix
Acknowledgments xi
Diclaimer xiii
INTRODUCTION
This is My Money Management System 1
PART ONE Psychology of Risk Control 7
CHAPTER 1 It Just Ain’t Sexy! 9
CHAPTER 2 Confidence in Your Plan 15
CHAPTER 3 Yin and Yang 23
CHAPTER 4 Risk Psychology and The Trader’s Mindset 31
PART TWO Stop-Loss Exits 37
CHAPTER 5 Not Every Trade Will be a Winner 39
CHAPTER 6 Entry Rules and Your Trading System 45
CHAPTER 7 Stop-Loss Exit Rules 55
CHAPTER 8 Scaling Out and Scaling In 65
PART THREE Trade Size Does Matter 73
CHAPTER 9 Using Risk-of-Ruin Tables and the Optimal f Formula 75
CHAPTER 10 Using the Two Percent Risk Formula and Proper Trade Size Formula 83
PART FOUR Record Keeping and Profit/Loss Analysis 89
CHAPTER 11 Tracking Profit and Loss Results and More Formulas for Success 91
CHAPTER 12 Using Trade Posting Cards and Ledgers 99
PART FIVE Design Your Own Plan 131
CHAPTER 13 Know Thyself—Your Risk Profile and Discipline Profile 133
CHAPTER 14 Risk Management Rules to Choose From 139
Epilogue 149
APPENDIX A Getting Started with Your Trade Size Calculator Software 151
APPENDIX B The Trader’s Assistant Record Keeping System 153
APPENDIX C The Art of Paper Trading 167
APPENDIX D Resources 173
Glossary 179
About the Author 203
Index 205
Author Information
Bennett A. McDowell is the founder of TradersCoach.com® and an expert in technical analysis and complex trading platforms. Earlier in his career as a financial advisor, McDowell used his own proprietary trading system to serve a community of high-net-worth clients. This system is now known as Applied Reality Trading®, or ART®, and is used by traders around the world in over forty countries. McDowell lectures nationally and writes articles for many leading trading publications, including
Technical Analysis of Stocks & Commodities magazine. He is a recognized leader in trading education and is honored to be included as a member of the eSignal “Trading with the Masters” team. McDowell is also the author of
The ART® of Trading, which is published by Wiley.