Lecture 22 (Module 4). Money Management

Why This Matters More Than Strategy

Every strategy in Module 3 answers the question “when should I trade?” Money management answers a completely different, arguably more important question: “how much should I risk when I do?” A mediocre strategy with disciplined position sizing can survive indefinitely; a brilliant strategy with reckless position sizing eventually doesn’t. Lecture 10’s Martingale lecture was really a preview of this exact lesson, just in its most extreme form.