Lot size, contract size, max position ?

[Beno]

Gidday

Now this is a real beginner question but here goes I am attempting to create a MM system to limit the lot size and the number of trade a system can take via the size if the maximum position but I think I am confusing myself

Am I right in thinking

1 standard lots = control of 100000 of a pairs base currency.

2 mini lots = control of 20000 of a pairs base currency

3 micro lots = control of 3000 of a pairs base currency

4 nano lots = control of 400 of a pairs base currency

if thats correct then great

so if the above is correct

then 0.01 lots on a standard account should control only 1000 of the base currancy.

so if I only want to have a maximum position of 20000 that would mean I could have 20 positions open at 0.01

Cheers

Beno

[pippersnapper]

Beno, you are correct in a sense. . .unfortunately, margin is your enemy in this equation! 20 positions at .01 lots requires more margin than does 1 postion at 0.2 lots. MM cannot simply be based on lot size alone, and certainly cannot be based purely on amount of currency traded!

Please remember S/L, margin, and account balance in your equation!

[Beno]

Thanks pippersnapper

thanks for the info.

What I am trying to do is use the max position size to determine the max lot.

Level Max Position Max Lot

1 20,000.00 0.2

2 50,000.00 0.5

3 100,000.00 1

4 200,000.00 2

5 500,000.00 5

6 1,000,000.00 10

7 1,500,000.00 15

8 2,000,000.00 20

9 3,000,000.00 30

10 4,000,000.00 40

11 6,000,000.00 60

12 8,000,000.00 80

13 10,000,000.00 100

So based on the above on a standard account I had 3 signals I could only open 2 positions of size 0.1 this is a way to help limit over trading.

[Beno]

Here is a couple of excel sheets a 200 and 97_2003 to try and explain.

[Beno]

oh and there is an example of what you could be looking to take out of your account on a monthly basis.

Cheers

Beno

[Beno]

update excel sheet

I think i have this correct now.

just change the account type.