I found out that this is a great way to build wealth. It serves as a good leverage technique when saving and investing. The main principle of it is to not get greedy and never invest an amount that you would not be willing to lose on an investment. Cool Idea. However, a lot of investors don’t practice this great technique. Do you?

 

  • sunnygc 5:47 pm on November 30, 2009

    What you are talking about is the only way to remain ‘in the game’ when it comes to investing. I’ve seen so many people take on more than they can risk and eventually lose everything. It’s painful to watch all your wealth disappear overnight.

    Position sizing is the ultimate way to create wealth. You just need to align your position sizing in order to meet your financial goals and you should do very well.

    The number 1 rule of investing is capital preservation.

    Below is a link to an article that describes how powerful leverage can be. 400% in 9 weeks. Wow.

  • Ted 5:47 pm on November 30, 2009

    "position sizing" is part of money management which is what keeps all professional traders in business. Individuals tend to ignore it because it’s not glamorous and instead focus on trying to find a "secret’ or the next Apple.