Position Sizing & Money Management
How much to bet — the decision that matters more than what to buy.
Lessons
- Why Sizing Beats PickingA great pick at the wrong size loses; a mediocre one at the right size compounds. The overlooked lever.
- Fixed-Fractional SizingRisking a constant slice of capital per position — simple, robust, and self-correcting.
- Volatility-Based SizingBet smaller in wild markets, bigger in calm ones — sizing that adapts to risk automatically.
- Adding to Winners (Pyramiding)Scaling into positions that prove you right — done carefully, it amplifies your best ideas.
- Portfolio HeatThe total risk live across all positions at once — the gauge that stops you from over-committing.