Ep. 742: Trend Following Fifth Edition with Michael Covel on Trend Following Radio
Michael Covel's Trend Following
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The Importance of Calculated Risk in Trading
Calculated risk lies at the heart of every great achievement and achiever since the dawn of time. Most focus only on how to enter the market, but when it comes to trading they need to take a step back. If your trading system says you have a 1 in 30,000 chance of winning, or roughly the same chance as being struck by lightning, you don't bet everything. You must have a mathematical expectation, an edge, or you won't win in the long run.
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