SKILL.md
Position Sizing
Position sizing is the single most important risk management decision in trading. Your entry signal determines direction; your position size determines survival. A mediocre strategy with proper sizing will outperform a great strategy with reckless sizing over any meaningful time horizon.
Core principle: Size determines survival, not entries. Two traders with the same signals but different sizing will have wildly different outcomes. The one who sizes conservatively survives drawdowns and compounds capital; the one who oversizes blows up.
Methods Covered
| Method | Best For | Key Input |
|---|---|---|
| Fixed Fractional | General trading, most recommended | Account risk % |
| Volatility-Adjusted | Volatile markets, multi-asset | ATR or realized vol |
| Kelly Criterion | Quantified edge with track record | Win rate + payoff ratio |
| Liquidity-Constrained | Low-liquidity Solana tokens | Pool depth |
| Anti-Martingale | Trend-following strategies | Recent P&L streak |