I allocate my equity among a few strategies. I manage and track each of them separately.
1. Daytrade
I daytrade forex, gold and equity indices. I watch important levels and the price action bar by bar on a lower timeframe mostly on 5min or 15min charts. I develop price scenarios and try to trade those that I believe have a high enough likelihood and payoff potential. I size my position based on the entry, stop levels and the % of equity I'm willing to risk on a single trade. Risk size is a dynamic factor varies from 0.5% to maximum 2% depending on the setup. I might add to my positions once my stops are at least near where I got in.
2. Asset Classes and US Sectors Absolute Return
It is a flexible Long/Short strategy. The constraints are the investment universe and that the total absolute exposure must be around the total equity allocated. The investment universe is sectoral, industry, country and commodity ETFs. I do not use stops here, the risk management is the capped position size, diversification and mental stop levels where I have to rethink my trade.
3. Equities and ETFs medium term Long/Short
The approach is very similar to what I use when daytrading. I trade SP500 shares, some European stocks and the most liquid ETFs but on a higher timeframe, mostly on hourly and daily charts.
4. Fundamental FX
I started this just recently. I take FX positions based on my fundamental view. The position size is directly linked to the equity allocated to this strategy, therefore the maximum loss is capped by the actual volatility. The equity must be fully invested at all times. I rebalance it on a weekly basis.
