Position Lot Size Approach
While trading with Signalator signals, you may choose from the four available lot size options: fixed lot size, risk lot size, flexible lot size and AI lot size. As you will see, the results may be quite different depending on the chosen risk management approach.
FIXED LOT SIZE
Fixed lot trading uses a fixed amount of lots when opening a new trade. You define the size of a position and then trades are executed with this number of lots. For example, you use 0.25 lots to trade. You will maintain this level if your account grows or declines (at least within a certain level). Once your account reaches any critical value (either after growth or decline), you may update a trading lot. On the one hand, it may be reasonable to have the same level of exposure - you get both losses and profits with the same amounts and hence your trading will be balanced.
RISKING A PERCENTAGE OF YOUR DEPOSIT FOR EACH TRADE
This type of lot is widely used among the forex traders. Every new trade will risk a certain fixed amount of an equity balance (e.g. 2%). This is the reason why traders prefer to use this type of lot. You control the maximum level of risk for every trade based on a percentage of your deposit. So profits and losses will have results relative to account equity. The more funds you have the more profit you will be getting (and losses as well). If an account value goes down, both losses and profits will be lower as well. This kind of trading makes trading very flexible.
FLEXIBLE LOT SIZE
Flexible lot is an advanced way of a fixed lot with elements of risk management similar to the % of Deposit lot type. Position size is calculated for every new trade. The calculation is based on the account equity value. The higher equity you have the more lots you open and vice versa. Once you decided how many lots you will be opening for your current equity size, you define two parameters: lot size and flexible deposit level. Deposit level will be used to calculate the number of lots you shall open. In other words, autotrader will be opening as many lots as required based on a simple rule: open Y lots for every X deposit level.
AI ADVANCED LOT SIZING
AI lot sizing uses a special algorithm for analysing past performance for each trade within a single trading system (e.g. one currency pair signal) and for each signal individually within a group of signals traded together. By increasing money allocation to well-performing signals and lowering the volume of worse-performing signals, your trading gets both marginal incomes and reduces losses. This type of lot size is considered to be the most advanced and is recommended to use with all Signalator services.
Overall Trading Results Examples
Please get acquainted with the overall final results for the same trades executed with the same starting balance using four different lot size approaches. Regardless of any illustrations and figures, you are free to choose any type of lot sizing including not provided herein. Both examples are provided for the initial balance of $100,000. AI lot sizing profits during the profitable period are higher and losses within the loss period are smaller.
| Period of Trading |
1 July 2019 – 17 July 2019 |
29 November 2019 – 14 November 2019 |
| Profit Pips |
1,540 pips |
-527 pips |
| Total Trades |
192 |
240 |
| Fixed lot result (5 lots per trade) |
$76,955 |
-$26,322 |
| Flexible lot result (0.1 lot for every $2,000 deposit) |
$111,495 |
-$23,736 |
| Risk trading (2% for each trade) |
$108,687 |
-$22,568 |
| AI Lot sizing |
$124,558 |
-$16,699 |
Questions and Answers
What is the minimum deposit to trade with the Signalator signals?
- Basically, there are no requirements. You can trade with our signals with any deposit amount (even on a demo account). The recommended deposit levels are to be followed if you would like to increase your efficiency of the trading and to lower risks.
What do standard, mini and micro-lots mean?
- Every time you open a trade you buy / sell a certain amount of currency. In the case of GBPUSD currency pair, you buy or sell GBP. The Standard lot means you trade with 100,000 units. The Mini lot is 10,000 units and the Micro lot is 1,000 units.
What will happen if I don't follow Signalator recommended deposit levels?
- If you open too many lots, even a small loss may ruin your deposit. On average we use $1,500 deposit for each 0.1 Standard lot. Which means you can withstand 1,400 pips drawdown for a pair to stay on the market. If you increase the trading size by 10 times, the loss of 150 pips will cut your account totally.
What is a drawdown? Why it happens?
- Drawdown is the maximum decrease of capital during the trading. For example, you are trading and your account has a value of $15,000. If under any circumstances (loss trades, a combination of profit and loss trades) your account decreases to $14,000 then the Drawdown is $1,000 or 6,6% (1,000 / 15,000).
How to use the lot sizing?
- After the subscription, you will get the personal page with the subscription details. Under lot trading section, you will find the easy-to-follow setting page with all subscribed signals. At any stage of using Signalator services, we will be happy to assist you via all available support options. By your request, we will adjust all required fields to make your trading profitable.
I know nothing about lot sizing. Can you do it for me?
- If you require any assistance in setting lot size, choosing the most appropriate signals, etc. our professional customer support will help you to meet your high demands and expectations.
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