Trader Vic Methods Of A Wall Street Master By Victor Sperandeopdf |work|

This is not the same as investing 2% of your capital. It means if the trade hits your stop-loss, the amount of money lost should only equal 1-2% of your total account equity. This ensures that you can survive a string of losses without blowing up your account. As Sperandeo notes, "If you risk 25% of your capital on a single trade, you are one loss away from ruin."

Never risk more than 1% of your total trading capital on any single position. If you have $100,000, your loss if stopped out should not exceed $1,000. This forces you to adjust position size based on your stop distance. This is not the same as investing 2% of your capital

This mechanical approach eliminates emotion. It forces the trader to wait for the market to prove a change in trend rather than guessing or hoping. It is a strategy rooted in patience, ensuring that the trader is reacting to what the market is doing, not what they think it should do. As Sperandeo notes, "If you risk 25% of

Sperandeo's strategy is built on three hierarchical pillars: This mechanical approach eliminates emotion

| Concept | Trader Vic’s Rule | | :--- | :--- | | | Only trade the 9+ month primary trend. | | Reversal | The 1-2-3 pattern (trend break, test, breakout). | | False Breakout | The 2B pattern (new high, then close below previous high). | | Risk | 1% per trade max. Stop trading for the month after a 10% loss. | | Markets | Index futures, stocks. No illiquid penny stocks. | | Analysis | Price and Dow Theory only. No oscillators. |

Wait for the price to close on the other side of that line.