Help me with my strategy
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  1. #1
    Join Date
    Jul 2012
    Posts
    9

    Default Help me with my strategy

    Hey guys, I'm trading the S&P 500 on a long term investment, my trading balance is at $2 000 and I'm trading 10 lots per position, I'm pretty happy of the result but I'm worried not to have sufficient margin in case of price correction or temporary market crash that would blow my account out. So do you guys have any idea how I could survive or at less maintain my account or position safe in case of a market crash or small drop from the market ? Maybe with a hedging strategy ?

  2. #2
    Join Date
    Jul 2013
    Posts
    2,249
    Quote Originally Posted by aketo25 View Post
    I'm trading the S&P 500 on a long term investment, my trading balance is at $2 000 and I'm trading 10 lots per position

    Something doesn't add up, here: how can you trade 10 lots of the S&P with $2,000? For myself, I'd want an absolute minimum of $12,500 to trade even one lot of the e-mini S&P.

    (I'm asking because your post has been here for a week without attracting a reply at all, though I know there are S&P traders here, and I'm wondering if confusion stemming from the fact that the numbers don't seem to "add up" at all is the reason?).

  3. #3
    Join Date
    Jan 2017
    Posts
    17
    In my opinion first of all it depends on what does it mean 1 lot for you. There are certain platforms where 1 lot = 1 contract and I think that is the only possibility in your case as the price of S&P500 is around 2300... I think that the leverage that you are using for your position is a very big one as a movement of 2-3% means 20-30% of your account...But again this is my opinion

  4. #4
    Join Date
    Jul 2013
    Posts
    2,249
    You may be right, Andrew ... I was even wondering whether perhaps the OP was referring to spreadbetting, rather than actually to "trading the S&P". Something's "not quite right", anyway ...

  5. #5
    Join Date
    Jul 2012
    Posts
    9
    Quote Originally Posted by Andrew89 View Post
    In my opinion first of all it depends on what does it mean 1 lot for you. There are certain platforms where 1 lot = 1 contract and I think that is the only possibility in your case as the price of S&P500 is around 2300... I think that the leverage that you are using for your position is a very big one as a movement of 2-3% means 20-30% of your account...But again this is my opinion
    You're right, I have a leverage of 1:500 and 2-3% means 20-30% that's why I need a protection strategy to get rid of any margin call

  6. #6
    Join Date
    Jan 2017
    Posts
    17
    The leverage does not have anything to do here, it will only help you use less margin for a position and be able to trade more ( which in my opinion is very risky). But what is the size of 1 lot in your case? Is it 1 contract? Because a good strategy in your case would be trading with a lower volume just to be able to average down if needed...

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