Risk & safety
What is position sizing in crypto?
Position sizing is how much of your account goes into one trade, and it decides survival more reliably than entry selection does. The workable rule for memecoins is a fixed amount per trade, chosen so that a normal losing streak - twenty consecutive losses at a 30 percent win rate is entirely ordinary - is survivable and boring.
Work backwards from the losing streak
At a 30 percent win rate, a run of ten losses happens roughly every 35 trades. If ten losses would end your account, your account will end, and it will end for a completely ordinary reason. Choose the size that makes twenty losses uninteresting and you have converted an unknown risk into a known one.
Why fixed size, not a percentage
- A percentage grows your size after wins, which means you take your largest position right before the streak that ends it.
- A percentage shrinks after losses, so recovery gets slower exactly when you need it not to be.
- A fixed amount is checkable at a glance, which matters far more than optimality at the speed these trades happen.
The three rules worth writing down
- One number per trade, unchanged for at least fifty trades.
- A cap on open positions, because size means nothing if thirty of them are open at once.
- A daily loss limit that stops you for the day when hit. The trades taken after a bad morning are reliably the worst ones.
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