“Save more money until I have an x amount of capital to afford the daily volatility…”

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Hello Michael,

I hope this email finds you well wherever you are. My guess would be somewhere in Asia.

I bought your Trend Following audiobook after listening to Market Wizards and The New Market Wizards. Also bought your Little Book of Trading.

I have been listening to your podcast as well as Top Traders Unplugged.

Thank you for all the material you have made available for all of us. Really appreciate it.

I have been attempting to trade Forex for over 5 years now. Always envisioned riding long trends yet somehow through self-sabotaging, I would end up modifying my plan and look for shorter-term strategies where I could consistently earn 10-20pips.

It would work for a while but eventually I would end up blowing up the account.

I figured if I knew programming I would test different setups and find something that would work but despite the fact that I learned Python and PineScript for trading view I have not been able to find something that can work for me.

Thanks to programming I now help other retail traders with automation at Upwork. I’m one of their ‘Top Developers’ and have earned a little over 20k doing it so at least I believe I have managed to recover my trading loses by helping other traders lose their money. Talk about zero sum game.

Anyhow. I love the philosophy of Trend Following. I haven’t yet gone live with my system. Still testing a few things more in line with risk of ruin, correlations in the portfolio and other aspects of risk management that are yet not very clear to me.

The main reason I ask is due to cost per trade. A 2-3ATR stop loss on an hourly timeframe is certainly lower than on the daily or weekly.

If I’m starting with $500. Is it better to start in a lower timeframe or to trade in the daily but choose fewer symbols/markets? Those are the only two ways I can think of reducing potential costs.

I have yet to hear or read in any of the Trend Following material available anything about time-frames. Trend Following is long-term, sure but are we talking daily as a minimum due to less trending potential in lower frames?

Is my answer “save more money until I have an x amount of capital to afford the daily volatility?” What amount would be the bear minimum?

I want to make this work. Let me know your thoughts if you have time.

Thank you.

Ricardo D.

Trading on hourly time frames with $500 is a dead end. Buy lottery tickets instead. Trend following capital issues.

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