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It's Tom Diesel here. I hope you guys had a great trading week this week and today I'm going to go over one of the, I think it's the most important topic aside from risk management. This topic is about sizing. This topic is really what's going to define whether or not you can make it in this game or not. Aside from risk management, risk management is really about how you setting stops and to protect your account. That's pretty important. That's basically the most important part and then sizing because risk management, it's just not about how you handle the losses but how you can be able to take advantage when it comes. That's what's going to grow your account basically and if you don't have money in the long term, I mean it's really no point for you to stay in this game. Sizing is really an art and I like to bring out Alex Block here and I mean to me it's pretty huge if you guys have time and just go over that and a lot of good stuff on here and you can read it yourself. I'm just going to quickly go over some of the key points here and a lot of us see on Twitter and people posting massive gains regularly size up due to Firmware and everything. Because you can't skip the organic aging process here as Alex says every trader ages their own way, their own speed, not everyone else and some might take one, two, three, five years, eight years or even a decade, I don't know but some like Faye took her like three months so it really depends on your personality and how much work you put into that and how well you can process the data and or how fast you can process all the information that's from MIC and everyone is different and sizing up here is really no small thing, whatever you are, whatever comfort level I mean it's really different from person to person and it's here sizing relative not general one case yes to you might be pocket change to him right first and you know this is the key point here you know some some traders they try to push size but they don't look at their account and they don't do it you know systematically and that's what's causing them you know to kind of blow up or like you know lose chunk of money in one single trade so yeah so you first start out you know this is all everything here and I like this the most sizing is the art form itself and you know it's not like normal trading like the beginning of your career with several factors you know there are signs to it and along with finance yeah so you know I mean you know put it out somewhere in this if you want to take a note you can go to his blog and you know this quote is probably the best size into the best and sculpt the rest it's pretty famous one you know trading community so yeah you know sizing it's it's not easy and to be honest this is what I've been struggling daily and I think everyone goes through that and I got so many questions from the members regarding you know about sizing you know Tom how come I always have the most size when I'm down but when I win I have really you know tiny and you know that's that's basically what we do in like what I did in in the beginning right whenever I lose I usually have my max size first right you need to find an edge if you want to size up on something you need to know what you're gonna trade right I mean you need to have an edge it's like when you're open in business you need to have some sort of product to sell and then when you saw the product has been working you know customer buying it you know and then you can you know buy more and you know save in your warehouse or whatever so that's pretty much the same thing here edge and for edge you know you need an outcome it's like this is a probabilities game right it's not based on one setup one trade it needs to combine all the data in several months or like even year and that's basically what it's going to define if it that's your edge or not I mean if you can do that consistently if you found an edge right you making money consistently I don't know 10 dollars 20 dollars or 30 dollars let's say for five months for five months or a year already right and as the day comes you saw the same pattern repeating over and over again yes you could size up but you know you have to do it naturally it's like in this month you're trading 100 shares right next month you see the same setup all right you know I've been seeing this for quite a while enough for a month now let me try to bring it on to 200 shares and then next month 300 shares right and as your account grows I think this is the best way when you have I don't know when you have five thousand dollars you know in your bank account and you know it might differ it might be differently for someone is under PDT and in this example I'm just going to say you know assume that you're not under PDT right and you have only five thousand dollars and so the best you know percentage in my opinion it's around one or two percent per trade so let's say in this case and you know two percent that's your hundred bucks that's your hundred bucks right and let me bring on here the chart let's assume that your edge is trading the first resistance right you saw two line let's see if it's on the daily as well let's assume you know two line is on the daily yeah or like 220 something here and that's your edge right so your plan is to shorting into this and stop out I don't know maybe 210 so you want you want your entry to be as close as possible to that 210 right so it could be I don't know 199, 201, 203 but let's say I just want to short here at 201 and stop it you know 211 so that's 10 cents right 10 cents based on your account that you can risk you know money wise is you know hundred bucks right so 10 cents that would equal to 1000 shares that's what you should be risking max for your trade right but if you want to scale you want to scale here 1.9 so you have to divide it like two bullets here as well you know you have to divide like 500 for 1.9 and 500 for 2 right so in this case your average would be 295 and then you have to think you know so my max risk per this trade is 100 bucks right and my average is 195 so my technically I cannot risk until 211 right so I have to risk like 205 here so you know just do the math around that and do it systematically so that way you don't have any surprises when the trade comes and one of the thing here you can do is you know on OCO orders and or limit orders adding like that it's really up to you but I'm just showing you the example here and how you can calculate that you know sizing based on your account of course this is the proper way how to do it it's like I think you shouldn't risk more than 2% to be honest and like max max per day shouldn't you know across that 5% so you know 2% here so maybe like if your account is 5000 you shouldn't be risking like your max loss should be 250 bucks I think that's pretty much it and you shouldn't risk more than that per day and if that max loss hit and you I think you should probably you know just simply work away and don't try to you know make it back and that's that's not the optimal way how how to to deal with that loss so and and as I said before the two you know you have to kind of learn to be comfortable with taking small losses because if you're not you try to revenge it you're trying to fight it you know this 250 could end up you know in being like 2500 and and that's and you know 50% of your account in one day so and it's pretty hard for you to come back after that mentally all right guys so if you still have any questions just DM me have a great weekend see you on the next one take care thank you so much for watching our video you want to see more of our videos please subscribe to our youtube channel by clicking the button here we do our best to post a new video every single day if you have any questions about MIC or any general trading questions please text Tosh using the number here also stay up to date by watching some of our most recent videos right over here