You don’t want to trade too small or too big and obviously when you’re first testing, it’s going to be very small. But once you have a solid trade plan and you’re trading regularly and trading often, then you want to trade based on your account size. What I use for my credit spreads is for every $10k I trade ten wides and use one contract for Monthlys, one contract for 0 DTE and three contracts spread across different expirations for 7 DTE.
Establish your trade size based on your account size. You don’t want to trade too small or too big and obviously when you’re first testing a strategy, it’s going to be very small. Once you think that you have a solid trade plan, trade small and trade often and base it on your account size where a single loss would never be more than 2% of your account.
Talk soon,
Al Losada
Founder | SimpleOptionStrategies.com
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