all right guys um hey coach uh when should we increase size on a play when the risk is low or when the probability is high the person goes on to say I have seen you play heavy size when you see low risk can I take can you talk more on this yes okay the question is can size be determined by the amount of risk or the risk unit that you're taking in a trade all right and the answer is yes my size is not entirely determined by risk but it is partially so so let me give you an example of this let me give an example of this let's say I have a maximum loss per trade of $100 listen to me carefully traders built into my trading plan is this rule i will not lose more than $100 on any given trade that is part of my trading rule right as an example now this play I'm about to take has a risk of 40 cents so the stop if I take this trade the stop is 40 cents away if so if I take 100 shares of that play I'll lose $40 but if I take 200 shares of that play I'll lose $80 which still stays within my maximum $100 loss per trade i'll do 200 shares versus one you see what I'm saying so that helps me determine what size am I going to play here can I get away with more without losing more so I'm going to lose the same 100 or less but with 200 shares I have a greater upside potential than with 100 shares but with the same risk so I do use risk to determine size another example just to drill that point home i have a $100 maximum loss per trade my risk now is 25 let's say it's 23 cents just a little bit below 25 cents because that's where the stop is now we don't determine what the risk is the trade actually does so on this particular trade I'm buying above a small bar right below that small bar it's 23 cents away i can do four lots on this play and not increase my risk of $100 or less you follow what I'm saying and so one trade that might have a an 80 cent stop I can only do 100 shares the trade that has 40 cents I can do 200 shares the trade that has a 23 cent stop I can do 400 shares so my risk is the same on all of those op those trades but the upside potential is greater with the greater size so yes I use risk my risk unit to determine my risk unit and my maximum loss per trade to determine how big or small the trade's going to be but that's not the only thing that I consider as well for size i consider upside potential and I consider not only upside potential but time duration of the trade so if my time duration of the trade's going to be very short my size goes up let me give you an example if I'm going to hold a stock for 5 years I'm going to play it smaller if I'm going to hold the stock for 5 minutes I can play it much bigger why because what's the odds of something bad happening in 5 years versus 5 minutes the odds are exponentially higher over 5 years that the unexpected in a bad way happens to me so I have to lower my size with a 5-year play but 5 minutes gives me a short enough period of time to believe that a meteor is not going to hit planet Earth in which case the trade doesn't matter anyway all right no additional war is going to break out in this 5 minutes the Federal Reserve is not going to hike interest rates by surprise do you follow what I'm saying so my point is is that time duration the smaller my t the time duration of my trade the safer the trade the longer the actually the riskier the trade to a to a certain extent all right this is not universal but to a certain extent i want my traders thinking this way so to take it from a to take that concept to a pure trading perspective if I'm gonna if I'm gonna play this play for two or three bars so I'm buying right now and I think the stock can shoot up two or three bars after this buy buy boom boom out okay as a shortterm scout play buy one bar two bar out all right or short one bar two bar out okay that's a scout that's kind of like a scout play that play I can play bigger than if I'm going for a play over an hour or so 50 minutes to an hour so now because my money is exposed to the possibility of danger longer all right I have to but my gain my potential gain is bigger i can afford to shrink the size the shrinking of the size doesn't mean I make less i could make more because my time horizon is longer but because more can go wrong I'm also going to shrink my size so time duration also um so time duration of the trade risk of the trade narrow state best position is right above the state I've got elephant bar nice I enter at the 1 minute 30 second mark remember that boom my stop is under the bar if it doesn't work the most I'm going to lose is the elephant are okay what's my ad the ad is the first color change to happen after this elephant bar when is the first time you get a red bar which is the opposite color you're playing green but you get the opposite color and then a green bar wipes out the opposite color the moment the instant the nancond boom that's your ad you must add on the first color change without fail it's mandatory it's mandatory but but Oliver what if no the first color change add but wait a minute if no ifs add first color change but Oliver what if what if the S&P What if the market is rolling over no add on the It's mandatory add on the first color change Oliver but what if planet Saturn is not in proper alignment it doesn't matter add what if What if I fall ill right before the ad add anyway and then go to the doctor all right but Oliver tired of that i want you to imagine right narrow state boom perfect position right under the narrow state this elephant bar forms boom you're in at the 1 minute 30 secondond mark boom in stop above the bars high you're not going to lose more than this one bar right there okay now you're in um and let's say you're in two lots all right we I don't want to get into what lots are whatever but you're in two and then you add one right there boom now you've got three total lots into play first color change mandatory after the initial entry first color change mandatory ad this ad is going to throw you over the top statistically over time what do I mean by throwing you over the top guys it's the ad that actually has you separate yourself from the ma trading math that's close to break even so there's a there's trading math and I can't go into it now cuz you're not my traders yet but there's trading math that you have to understand as a trader and there's a trading math zone in your trade where if you stay right here and just do this you're going to over time come up around break even but if you do this one extra thing it'll throw you out of the break even zone meaning that you're no longer subject to break even trading the ad is one of a variety of things that throw you out of the break even math of trading you've got to be a professional adder and I've just given you one of our professional ads the first color change after your initial entry