The one thing I suggest is writing something on the level of knowing when to increase your size. Or knowing when to take the next step as a trader. And this is where I have some difficulties in. I’ve been trading for almost three years as a spread trader and am ready to take the next level. The question is now how to take the next level?

I appreciate your insight!

 

I have seen traders challenged to find the next level in multiple ways.

1) Just force them to trade bigger.
2) Have them sit next to bigger traders.
3) Systematically get bigger slowly but consistently.

At our prop desk we use door #3. Why?

It is our culture to get bigger responsibly and thru rehearsal after the close. We believe traders get bigger on their own terms and on their own schedule.

Trying to force traders to get bigger can cause trauma. A loss too big can set a trader back months.

Be careful when sitting next to that bigger trader. Do not try and copy his trading as that will not work. He has a bigger downside than you and may make sense of the markets differently. Co-opt the trades that make the most sense to you and make them your own, trading them with risk that you are comfortable with.

Our general rule is to bump traders up after ten days of positive trading data. For a new trader we bump them 20 percent every ten days of solid trading data.

I have written about getting bigger in the past and my sense is too many focus on the wrong things: share size, dollar risk per trade. I recommend that traders think in percentages and not share size or dollar risk. Develop a system where you risk a certain percentage of your book per trades. I offer a system for this in The PlayBook. Then increase the book you are trading but keep these percentages constant. This is an easier way to scale your trading.

Also to get bigger you may have to increase your trading time frame and learn to express your trading in different products. Perhaps a swing trade needs to be made with options. Perhaps a 15m time frame will work better with more size than a 5m.

Keep trying new trades to add to your PlayBook. Trade them with small size so they do not affect your trading results.  Invest in your trading future by trying new plays for your trading. If they do not work then move on.