[Anonymous]

Sensei;

* I did not say the use of multiple strategies is wrong, only the use of various contract sizes with the various signals is something I do not understand.

* I have been talking about multiple strategies as they pertain to the same trade length. In other words, a daytrade signal vs. another daytrade signal. If one trades 10 lots on a daytrade, it is reasonable to trade fewer contracts on a different signal type if that signal type is a swing trade. Obviously the issue of margin comes into play here. Another issue is psychology. Which brings me to my main point.

* If signal type A is more reliable than signal type B and you trade fewer contracts on signal type B, you are telling yourself on some level to trust signal type B less than signal type A.

This is if fine WHEN THINGS ARE GOING WELL.

Now suppose we have two different situations:

1. Signal B has been incorrect 3-5 times out of 3-5. Can you pull the trigger on the next Signal B ? The very fact that it is traded with fewer lots implies that you trust it less. If that was not the case, than either you would trade it with the same amount as signal A or more. So from a trading mind set point of view, it is more added baggage to deal with from my point of view. The lesser quality trade has been a loser, but it is known to be a lesser trade by the very fact that fewer contracts are traded. Now one is asked to pull the trigger like all things are equal.

2. With two weeks left in the month a trader is experiencing his worst draw-down in 6 months. A signal B type trade appears. Now he must trust in that signal and take it. But since he has placed a lower lot level on the trade, based on his confidence in it, how can he now trust it? This can possibly create more demons to fight in a field replete with them.

Now suppose the trader has lowered all signal types to 1 lot due to the draw-down. Still here, the trader knows that all signal are NOT created equal. If they were, then he would already by using similar lot sizes for all. So the very fact that he is now using equal lot sizes reinforces the lack of recent profitability. Yet he still has to deal with taking a less quality trade, at the time when what he needs most is a profitable trade. While the outcome can not be known in advance, why take a lesser quality trade if you do not have too. What makes is less quality? Don't know. But if it were of equal quality then the lot size trade when things are going well should be the same as all other trade signal types.

* On some level, different position sizes put the signal types on a "trust scale". This may work out good when everything clicks. But at the first sign of trouble (long period of drawdowns, or continuous losses on the lower sized signal) it effects HOW a trader trades. How can it not?

* Again, I am not saying I know more than anyone on this subject. I am simply saying that I believe there is a sub-conscious value weighted system put in place when size varies with signal quality. Trading is simple, but not easy. Having to overcome that weighted value system when things are not going well only adds to the difficulty inherent in trading.

* Playing the "money I could of made" game is surely a road to ruin. Not every profitable move will be captured. It is erroneous to say that profit is missed because only the high quality trades are used. Yet, there is a way to improve your profitability by trading more markets and more timeframes. If one doesn't mind high quality and less quality trade set-ups, that is fine. The contracts used, however, should not reflect the variance in quality. A trader needs to trust every signal equally and that should be born out in equal lot sizes used.

* As this is my last post on the subject:

1. Multiple signals are fine, but one should keep the size traded equal for the psychological advantage incurred.

2. If various types of trades are made, daytrade, swing, scalp, clearly size will vary. This variance, however, is based on trade type, not signal type.

3. Profitable traders trade the same when things are going bad as when they are going well. Note I am not talking about not reducing size during drawdowns. I am talking about willingness to take a trade. If your position sizes reflect how confident you are in a trade, can you continue to trade it when things are bad? A 5 lot quality trade when things are good, may be turned into a 1 lot trade during such a period. A 3 lot also turns into a 1 lot. However, the quality of the 5 lotter is still higher than the 3 lot signal type. And on some level the trader knows this.

4. If you want more money, trade more contracts (on the best signal only). Or trade more markets. Or more timeframes. This makes more sense in terms of the trader's mind (to me at least) than trading various quality of trades AND trading them at varying sizes.

5. You will always leave money on the table. There will be other opportunities to make money.

* Thank you Mark for your posts.