Ralph Vince – The Mathematics of Money Management: Risk Analysis Techniques for Traders

Book DescriptionEvery futures, options, and stock markets trader operates under a set of highly suspect rules and assumptions. Are you risking your career on yoursa Exceptionally clear and easy to use, The Mathematics of Money Management substitutes precise mathematical modeling for the subjective decision-making processes many traders and serious investors depend on. Step-by-step, it unveils powerful strategies for creating and using key money management formulas based on the rules of probability and modern portfolio theory that maximizes the potential gains for the level of risk you are assuming. With them, you ll determine the payoffs and consequences of any potential trading decision and obtain the highest potential growth for your specified level of risk. You ll quickly decide: What markets to trade in and at what quantities When to add or subtract funds from an account How to reinvest trading profits for maximum yield The Mathematics of Money Management provides the missing element in modern portfolio theory that weds optimal f to the optimal portfolio. The publisher, John Wiley && SonsPermits traders in the futures, options and stock markets to create profitable trading formulas based on the rules of probability and modern portfolio theory. Shows how to develop and utilize key formulas which minimize losses, maximize profits and avoid excessive risk.Reintroduces the idea of &&optimal-f and its use in weighing and assigning values to the components of a trader s portfolio.Includes a computer program for immediate hands-on usage of techniques described.