Money Management, the Key to Trading Success

In this week’s
Big Saturday Interview, we are fortunate to have with us, Ryan Jones.
Ryan has been a futures, stock and options trader for 18 years. He is the author
of
The Trading Game,
Playing by the Numbers to Make Millions

along with numerous articles and courses on money management and trading
strategies. For much of his career, Ryan has focused on developing a method of
money management that helps traders achieve a better balance between account
growth and controlling risk. Ryan’s method, called Fixed Ratio Trading, is
designed to allow faster growth with smaller account sizes, while reducing
drawdown risk for larger account sizes. In this interview, you’ll learn about
Fixed Ratio Trading and how it differs from other forms of money management that
are commonly in use.

Eddie: Hi Ryan, welcome to the TradingMarkets
Big Saturday
Interview
. Ryan, you’ve been trading futures and options for the past 18 years. Is
that right?

Ryan: Yes, 18 years now.


Ryan Jones

Eddie: Can you share a
little bit about your background and how you got started in this business?

Ryan: Well it started when I was young chap back in the mid-80s.
Phillips Petroleum was based in my hometown, Bartlesville, Oklahoma.

There were rumors that they were going to
get taken over. It just so happened that I was involved in a stock trading contest
at my school and I was president of that little club. The stock trading contest was
not with real money, of course. I had a broker friend from my church who was
helping me out picking stocks and I’d go to his brokerage house after school.
Essentially everybody was talking about buying Phillips stock so eventually I
talked the guy into buying me several hundred dollars worth of Phillips call
options for me and I ended up losing money because Phillips was not taken over.

That kinda got me stuck. There are a couple of things I don’t like. One of
these is losing. And the other thing is losing. That’s what got me into
the markets and I haven’t left it since.

Eddie: So I guess experience got you hooked.

Ryan: Yes. The takeover didn’t happen. But what was in the back of my
mind was what would have happened if the takeover had happened. I wouldn’t have
been rich, but I would have been rich compared to what I was used to.

Eddie: So where did you go from there?

Ryan: What happened after that was I began looking at futures options
specifically. I ended up scraping up enough money to open up a $2,500 account…

Eddie: Why did you suddenly decide to trade futures options instead of
equities options?

Ryan: (laughs) That’s a good question. I was actually painting a house one
day listening to the radio. And a commercial came on about how heating oil never
falls in the winter. So that got me thinking…hmm…maybe I should buy heating oil
options. It was about October at the time. What hacked me off was that they only
told you part of the story in that heating oil always goes up in the winter, but
has to be down first. It was already trading fairly high that year and I ended
up buying call options and lost my entire investment in that one.

So that got me into the world of commodities. From that point on it was just
like the door was wide open. I did anything and everything that you can
possibility imagine over the next two years. I mean I did options spreads,
futures, I began selling options toward the end of that period, I used all kinds
of strategies…short-term, long-term…everything…I tried everything!

“…Money management was the turning
point…”

Eddie: Did you experience any successes? What kinds of things did you learn
during those two years?

Ryan: Everything I tried was successful to a
degree. When I bought the heating oil options, I had some success. The only
problem was that I held on too long. When I eventually traded futures, I
developed my own strategy trading across a very broad number of markets. I
started with $10,000 and ran it up to $22,000 in the span of 4 months. I was
21 at the time and I thought I was a genius. And about two weeks later, that
$22,000 dropped to less than $2,500. That was the ongoing occurrence. Over and
over again, I’d do pretty well and…boom…I would just blow out almost.

Eddie: That must have
gotten you…discouraged.

Ryan: Yes, that got me very discouraged and very angry at myself. So I took
six months where I did not do any trades at all. I went back through every
experience that I had gone through and essentially tried to pinpoint why I would
do well and then lose it all.

The ultimate conclusion was: Money management. I had not addressed money
management. That really was the turning point.

Eddie: So you had systems that had some degree of merit. But the missing
piece that you felt would make all the difference in the world was…

Ryan: Money management.

Eddie: Money management.

“…And so I began calling Larry
Williams and buggin’ the heck out of him…”

Ryan: There were certainly other things that I was learning at the time about
how to time the markets and how to pick the right time to enter and exit. In fact, the
method I used to take $10,000 to $22,000 is something I use today in modified
form from time to time. So I did learn a lot. But ultimately, what I learned is
that regardless of how good my trades were, if you don’t have a handle on money
management, it’s inevitable that you’re going to wind up losing.

Eddie: One thing I find unique about the path you wound up taking is this: Most
traders who go through that initial phase of frustrating losses, continue the
search for the Holy Grail trading strategy or system.

They’ll keep reading
books, attending seminars, buying systems and go through the same cycle of
frustration for years. And I think those that succeed are those that
realize that money management has to come first. Sadly, many
traders never even come to this realization. Is there anything that sticks out in your mind that caused to you understand
the importance of money management so early in your trading career?

Ryan: What led me
to that conclusion was that during that I came across Larry Williams’ record of
turning $10,000 into $1.1 million in one year. And so I began calling Larry and buggin’ the heck out of him. I asked him all sorts of questions and, of course,
he was telling me about money management and he told me that that’s what
ultimately allowed him to achieve what he did.

I bugged Larry for a while, calling him once every three or four days. As I’m
going through everything, I have questions to ask him. And ultimately what I
ended up concluding was that Larry’s approach was too risky for me. He was
risking too much of his account with the money management system he was using
for my taste.

That’s when I started looking for different types of money management
approaches and I guess that’s why it stuck out in my mind. I figure that if money
management is what allowed Larry to do what he did with that $10,000, then
obviously that’s where I needed to be concentrating. And when I focused on my
poor performance as I traded, I concluded that I had been overtrading, based
upon proper money management principles.

“…He had risked something like $1.4
million on three trades!”

Eddie: That brings us to the meat of this discussion. Let’s now
zero in on money management. You probably have looked at every money management
approach in existence. Can you give us an idea of what systems are in use today
and what you deem are their strengths and weaknesses? And also, let’s talk about
what led you to create your own money management system which you call Fixed
Ratio Trading.

Ryan: Essentially, what I saw out there was pretty much a couple
of money management methods that were recommended without any context or
explanation. There was no explanation as to what the risks were. No explanation
as why this is the best money management strategy. There’s no explanation as to
whether you use this if you’re an aggressive trader or a conservative trader. It
goes on and on. And I’m the kind of person who needs to know WHY. If I don’t why
about something, it’s going to be tough for me to do it. I’m also the type of
person that pretty much questions everything that comes comes in front of me.

Especially having analyzed Larry Williams’ method of money
management, I came to the conclusion that at the very top of his account he had
ran it up to $2.4 million during that trading contest. That
was the very top of his account that year.

That’s what I concluded based on my calculations. And I said to
myself, “Larry’s da man, but I can’t do that.”

Eddie: I know that you admire Larry Williams and that he’s
a friend of yours; Would it be fair to say that there was a lot of luck involved
in what he did with that $10,000 account?

Ryan: I think he himself would say that there’s some kind of
luck involved in the streaks that occurred during that contest. But, ultimately,
he was implementing an aggressive money management strategy, but it was one that
has proven then when there is a winning streak, it can do very, very well. You
just have to keep in mind that there’s a lot of risk associated with a losing
streak.

There are definitely mathematical principles that were involved.
You don’t grow a $10,000 account into $1.1 million by chance. It just doesn’t
happen. So there was definitely more than chance involved. But it was just too
risky for me.

Common Money Money Management
Approaches And Their Strengths And Weaknesses

Eddie: Drawing that conclusion, you
must have looked at what prevailing approaches where around at the time. What
did you think of them?

Ryan: That’s when I started asking questions. Why are traders
told to buy one futures contract for every $10,000 in the account? That’s one of
the most popular money management strategies in the world. You call brokers and
various people that don’t focus on money management and that’s kind of the
default money management strategy they tell you to use.

Here’s another common approach that I was questioning. They tell
you to “never risk more than 2%” of your account.” Well, I asked…what makes
that the best approach?

Ultimately, what I figured out was that money management
methods were addressing either the growth potential or they were addressing the
risk. And as far as I could tell, there was no happy medium.

Eddie: How would you relate that to the approaches you just
mentioned?

Ryan: The approach where you “never risk more than 2% of your
account” is focused only on the risk side. It’s focused on being conservative.
But I wanted growth, while at the same time I didn’t want it to get too risky.
So where’s the middle ground? Well at that time, there was none.

Eddie: Among equities traders, you will often hear “always use
protective stops.” And I think a lot of traders think that’s all there is to it
and it’s a “cure-all” and that is their money management system. But
there’s more isn’t there?

Ryan: I hear this a lot. When I talk about money management,
it’s often confused with where to place a stop. So I try to make the distinction
that trade management is different from money management. Where you enter and
where you exit is based your trade management. Money management occurs when,
before you enter the market, you ask yourself: How many shares am I going to
buy? How many options am I going to buy? How many futures contracts am I going
to buy? These are the questions that every trader ultimately has to answer, whether
they do it consciously or not. Either they default to some kind of formula or
they they’re going to just pull something of their hat and say “Well that looks
like a good trade. I think I’m going to trade five contracts today.” Position size
is a decision that everybody makes.

Eddie: I
think so many people think that placing protective stops constitutes money management that position sizing becomes an
afterthought. Isn’t that the case?

Ryan: Exactly.

Eddie: Let’s talk
about Optimal F. It got a lot of attention a few years back because it’s a
mathematically-based approach and a lot of traders took it seriously. Tell us
what Optimal F is and what you believe are its weakness and strengths.

Ryan: Optimal F is simply the optimum fixed fraction of
your trading account to place on any given trade. That fixed fraction, whatever
that fraction is, is supposed to achieve the most amount of profits. So if your
Optimal F is 15%, you place 15% of your account at risk on each and every trade.
Then, at the end of a given amount of trades, you will have built up your
account to a larger amount than had you traded 14% or 16% of your account. The
problem with that, though, is that it’s always based upon the past. So you’re
taking a track record and you’re coming up with a percentage based upon the past
and you’re applying it to the future. And you’re hoping that the Optimal F for
the last 100 trades is going to be the same for the next 100 trades. And 99 out
of 100 times it’s not. So you can be overtrading and turning a winning situation
into a losing one. And if you’re undertrading, you’re obviously not going to get
maximum growth.

Obviously Optimal F is not optimal because it’s on the past.
It’s not necessarily going apply to the future.

Another problem that I have with it is that it’s a fixed
fraction. The problem with a fixed fraction is that if you go too low, you’re
never going to see growth. And if you’re trading very, very inefficiently. And
if you go too higher, you’re going to very aggressive and you’re talking about
huge drawdowns. So if Optimal F is 15%, you’re talking about close to a 30%
drawdown on just two losing trades. That 30% of your entire account.

Eddie: Do you happen to know if Ralph Vince, the man who
popularized Optimal F, ever talked about adjusting Optimal F based upon a
moving window on a system’s recent performance?

Ryan: To be quite honest, I don’t remember if he did that.

Ryan Jones’ Fixed Ratio Trading

Eddie: Okay, well tell us about your thought process in
improving on Optimal F.

Ryan: Well, let me put it this way. If you want to be
aggressive, there are ways to be more aggressive without risking 30% or 40% or
50% of your account on two trades which is sometimes what Optimal F will do.

Eddie: Around the period of time we’re discussing, did you have
any trader friends or acquaintances who shared your views about money
management.

Ryan: Quite frankly, while I know some traders and Larry
Williams and I became friends, I felt like I was the only one questioning this
type of stuff. So it something that I just had to figure out on my own. It was
forced by my own experience and my own own conclusion that I couldn’t bring
myself to trade as aggressively as Optimal F dictated. And yet I wanted more
efficient growth than low fix fraction approach would offer me.

Eddie: What
forms of money management are dominant among hedge funds, money management firms
and other types of Wall Street institutions?

Ryan: I don’t know of any hedge fund that would apply Optimal F
simply because it is dangerous. It is very, very dangerous. Almost everyone of
them, however, applies a fix fraction, but with large account sizes they trade
only a small fixed fraction such as less than 1% of the size of their pool of
money. In my opinion that is still not the most efficient way to manage their
money.

Eddie: Okay, let’s talk about Fixed Ratio trading. What is it
and what does it do?

Ryan: Fixed Ratio came about in the need for a system of
money management for the smaller trader, which I was. Also, I wanted to address
the need for a less aggressive approach than Optimal F. So I couldn’t use the 2%
fixed fractional money management that many brokers give you because it was just
far too conservative and efficient. If you go higher, let’s 10%, then on three
trades you’re risking basically almost a third of your account. If you lose three
trades in a row, you’re risking almost a third of your account. That’s too
aggressive. It’s a very wide chasm to go anywhere in between there. You don’t
achieve any kind of efficiency by sticking with the fixed fraction.

What I did was break it down and analyzed what fixed fraction
really is. It’s one contract per every X number of dollars in your account. And
to me that was the flaw. You didn’t want all the growth to be at the backend,
which is what fixed fraction did. If it’s 1 contract for every $20,000 in your
account, it’s going to take you a very long time to get to 2 contracts. Whereas
on the backend, once you get to $500,000, it’s not going to take you very long at all
to be able to add a contract to your position.

Eddie: So what you mean by backend is that with the fixed
fraction method, a trader starting with a small account size had to sit there
and watch his account grow like molasses. But once you reached a higher account
size, the growth of your position size accelerated to a degree which was
unrealistic and highly risky.

Ryan: Yes. And what I wanted was something that worked faster
NOW for someone with a small account size but without taking big risks. So I analyzed it and said how can I
do that? The simple answer was that I would require less profits in my account
to begin with in order to increase from one contract. So I would increase my
account size faster. But as I began to increase my account size, I would slow
that position size growth down compared to the way the fixed fraction had me
doing it. Essentially, I would slow the position size growth down so that the
risk vs. aggressiveness was equal the entire way as the account size grew.

If I needed $5000/per contract to increase my position
size by one contract in the beginning, then I would need $5000 per contract in
order to increase my position when the account grew to $10,000.

So I basically equalized it. And
what that allowed me to do was be
aggressive at the beginning, but not too aggressive as the account began to
grow. And it was much more steady. I was able to start seeing growth immediately
instead of waiting until there was $20,000 in my account.

I looked at money management as a whole and I determined that
you need a money management plan that addresses everything that can happen before you
can start trading. You need to know exactly what you’re going to do and when
you’re going to do it so that there are no surprises.

Simulated Results From A “Generic” S&P Day Trading
System System

Example A:

One contract per trade

Example B:

Apply Fixed Ratio method

Fixed ratio trading adjust position size as
a function of profits. When a system is performing well, position size is
increased.

In the above two examples, we’re showing how a money
management method can affect the outcome of a trading system.

  • In Example A, the system is always traded with one
    contract per trade.
  • In Example B, the same is system is traded with the
    number of contracts being determined by the net profits of the system.
    When profits increased, position size increased as well.

Eddie: Many traders look for a mechanized, non-discretionary
method of trading that just generates buy and sell signals that you can follow,
no questions asked. It seems as though you’ve created a system of money
management that gives you “signals” that dictate how you control your position
size. Tell me what steps readers of this interview can go through in order to
implement Fixed Ratio Trading.

Ryan: Well, first of all, whenever you’re making a money
management decision, you’re deciding what your initial position size should be.
That is going to be decided on the basis of what strategy you’re using. What I
tell traders is that there is one goal that you first always address. And if you
don’t address this goal, you’re not going to be able to reach any of your other
goals.

The first goal to address is that the number one goal of trading
is to survive. That starts with the size of the capital you’re beginning with
and how aggressive you’re being with that. >From that you figure out your
position size. And once you know that you can set the levels at which you’re
going to increase your position size. When you do this, you have to play a lot
of what if games. You might say that when you’ve built your account up to
$75,000 you’re going to be trading four contracts. And then you have to think to
yourself, if I go through a drawdown at that level, I’m going to be risk X
amount in my account. If that’s too much risk, then you have to adjust
accordingly. By going through this process methodically through every
conceivable scenario, there are no surprises. When you have this all figured out,
everything becomes mechanical once you start trading.

Eddie: In Fixed
Ratio Trading my understanding is that position size increases as a function of
profit and loss. Can you walk us through the formula that you use to calculate
that relationship?

Ryan: The formula that I use is to look at the largest expected
drawdown. Ultimately, that’s what a lot of my planning revolves around. The
number one goal is survival. You’ve got to look at what you’re largest expected
drawdown is going to be. I can measure how aggressive or conservative I’m going
to be. If I expect my strategy to go to a $10,000 drawdown, then I’m going to use $5,000 as my fixed ratio number in that I’ll increase my position
size by 1 one contract when I have a $5000 profit in the account. If I’m more
aggressive, then I’m going to have a number that is lower than that. For
example, I will increase position size when I have $4000 profit in the
account. If I’m going to be more conservative, I’m going to go above that
number.

Eddie: As the account grows would you use that same level of
profit increment as the account grows?

Ryan: If you settle on a $5,000 level in order to increase from 1 to 2
contracts. Since we’re using a fixed ratio of $5,000 per contract, and you’re
now trading two contracts, you’d have to go 2 times the $5,000 and that’s how
much profit you’ll have to have in order to increase your position size to three
contracts.. So now you’ll need and additional $10,000 in new profits to go to
three contracts. Then you’ll need an additional $15,000 in profits on top of
that in order to go to four contracts. Then you’ll need $15,000 in order to go to four contracts. That is
pretty much the fixed ratio of the equation. So to answer your question about
whether you want to make adjustments, you don’t want to do that until you have a
very, very solid understand of how this all works and what the consequence of
these changes are.

Eddie: I
heard a story of a trader who approached you and who’d
made a lot of money. And that he wanted you to help him add money management to
his trading plan. And you said some sort of intriguing reply. Do you know what
I’m
referring to?

Ryan: Yeah. Someone came to me, read all of my material and then
began trading without using any kind money management method. About a year
later, he called me and told me that he was satisfied that his trading system
worked. He had made $70,000 over the past year and now he wanted to start using
money management. I was kind of shocked because based on the numbers that he
gave me and my assessment of how his system performed, I determined that had he
used my system of money management from the beginning, he would have made
instead of $70,000, almost $700,000 by applying the money management from the
beginning. This is something I hear a lot. People focus on getting their systems
right first. And then money management is an afterthought. That is a wrong
foundation that there working from.

Eddie: Let’s take a step back. Let’s walk through how the use of
Fixed Ratio enables a trading account to grow, given that you also have a good
trading system.

Ryan: We all know that a good system goes through winning
streaks. The key is to take advantage of those winning streaks. During winning
streaks Fixed Ratio trading allows you to be aggressive. But during a losing
streak, you’re taking away risk by lowering the position size. Let me give you
an example. A few years back I turned $15,000 into $107,000 in 90 days. That was
in a trading contest in which I daytraded the S&Ps. We basically were through a
very nice winning streak in this system I was trading. Without money management,
if I had just stuck with one contract the entire time, my $15,000 would have
grown to something like $35,000. But because I applied Fixed Ratio money
management I was able to capitalize off the winning streaks that occurred. Now
during the rest of the year, my system did absolutely nothing! This occurred in
April 2000, when the market tanked and the dynamics began to change. But my
money management system can cut the number of contracts and protect profits.

Trader A vs. Trader B

Eddie: For purposes of illustration,
let’s look at a hypothetical situation. How would you contrast Trader A who uses
no money management vs. Trader B who uses Fixed Ratio money management? Let’s
say that they both are using the same trading system.

Ryan: If Trader A uses no money
management or perhaps uses a very conservative approach and only trades 1
contract on any given trade, what you’re finding there is that his ENTIRE
outcome is based on whether his system continues to work or not. Trader A’s
profit is based on his system. What I want to do with money management is get
away from that.

I want to put more of the burden
of the profitability, not on whether the system continues to work, but on
whether the system will give me a winning streak that money management can take
advantage of.

Let’s say that Trader A makes
$20,000 a year consistently over the course of 5 years, so that at the end of 5
years he has $100,000 in profit. But then his system stops working for the next
three years and he loses half of that.

Contrast that with Trading B who
applies the Fixed Ratio method using $5000 as his Fixed Ratio. That person
will have the ability to increase the profits. At the end of that 5 years,
instead of $100,000, he may have almost $1,000,000 trading approximately 20
contracts.

Eddie: And when Trader B’s system
goes into a drawdown, what is he going to do differently from Trader A?

Ryan: When the system goes into a
drawdown and your account begins to lose value, you’re pulling contracts, shares
of stock, options or whatever it is you’re trading. At set increments…as it’s
dropping, you’re also reducing your position size.

Eddie: If the system continues to
generate losses and you’re reducing your position size, would that mean that
eventually you’d stop trading?

Ryan: Yes. If the drawdown continued
to exceed reasonable expectations. The key is that you would stop trading with a
lot of profits! If you built up your account when the trading system was on a
winning streak, here’s what happens. Let’s say you built up your account to
$500,000 in two years, whereas Trader A by then only had $50,000 or $60,000 in
profits. In both cases, the system has been profitable not suffered any major
drawdowns. Now let’s say that the system goes into a major drawdown and it loses
$20,000 per single contract. At the end of that, Trader A is left with $40,000
in net profits and he decides to stop trading. It’s too big of a drawdown for
him to handle emotionally and financially. Whatever. On the other hand, Trader B
who applied Fixed Ratio money management worked his account to $500,000 and he
may drop it to $400,000. The difference between Trader A and Trader B is just
unreal. In both cases, you’re out of the market, but in Trader B’s case, he took
full advantage of the system when it was profitable and consequently, he had a lot
more money to take off the table once the system stopped working.

Here is an example that Ryan uses when he teaches
people about the difference between Fixed Ratio Money Management and
having no money management at all.

Below is an end of day S&P E-mini
strategy 2-year simulated track record trading a single contract.

You will notice that the end result is a net profit of approximately
$40,000.


Below is the system starting with one
contract but increasing contracts based on the Fixed Ratio Method.

You will notice that the net profit is over $700,000.


Ryan: Eddie, there are several things that
I want to point out with this comparison we’re showing your readers.

  1. The same exact entry and exit was used on both
    examples. Every trade was exactly the same in both scenarios.

  2. The positions sizing strategy (money management
    strategy) increased the profit by a factor of more than 18 times trading a
    constant single contract.

  3. The number of contracts being traded at the end
    of the money management example is at 38.

  4. A $5,000 drawdown in the non-money management
    example represents 12.5% of the profits (net profits would be at approximately
    $35,000).

  5. A $5,000 drawdown per contract in the money
    management example represents 25% of the profits (net profits would still be
    at approximately $560,000)

  6. If the number of contracts would never decrease
    in the money management example, the per contract drawdown would have to reach
    almost $19,000 before the total net profits dropped to only $35,000.

  7. As shown in the money management example,
    contracts decrease during drawdown. Because of this, it would take a $35,000
    drawdown per contract to drop the money management net profits down to only
    $35,000. If that were to occur in the NON money management example, the net
    profit would only be at $5,000.

  8. The rate at which contracts can decrease can be
    faster than the rate at which they increased. Accordingly, in the money
    management example, if the drawdown persisted in this situation, the number of
    contracts would drop to 1 at approximately $350,000 in net profits (would
    require a per contract drawdown of $17,000 to do this). If the contracts being
    traded dropped to 1 with $350,000 in net profits, the system would then have
    to continue to see an additional single contract drawdown of $315,000 to drop
    the performance down to only $35,000 in net profits.

  9. The same scenario given above applied to the
    NON money management example would produce a net LOSS of $292,000!

    In the above example, money management would have a net profit of $35,000 in a
    system that ultimately had a performance with a net loss of $292,000!

Eddie: How do you respond to the
reversion to the mean argument? Basically, from a statistical standpoint,
a “good system” is destined to have both winning and losing streaks. But if the
system is indeed good, when it goes into a drawdown period, it will likely revert
back to its winning bias. Therefore, if you stop trading during a losing
streak you have the potential of missing out on the next winning streak that is
right around the corner. It’s just like what often happens when traders throw in
the towel just as the market bottoms out.

Ryan: The great thing about proper
money management is that you don’t have to guess about those things. You can’t
rally predict what a system will do in the future. A system that was once
profitable may never make money again. Literally, you may go through a nice
winning streak and it’s a winning streak that never happens ever again.

Eddie: Indeed, many trading systems
in the previous decade were developed in a bull market environment using test data
that had an overweighted bullish bias.

Ryan: What good money management does is prevent you having to guess and it allows you
to make your decisions on
the basis of a mathematical fact. Your system is either making money or it’s
losing money. When it’s making money, you can increase position size. When it’s
losing money, cut back before it diminishes your capital. Always pay attention
to what is happening to your account, not just individual trades.

Eddie: Ryan, this has been good. And I suspect for many readers, it may be a
revelation. But I caution traders not to try and construct a money management
strategy based upon this interview alone. I know your book well and while we’ve
covered the main concept, there are still a number details that are beyond the
scope of this interview. Your book is called

.
Correct?

Ryan: Yes.

Eddie: And I understand you’re on a mission of sorts to help
traders realize that they must focus on money management first and trading
strategy second, not the other way around.

Ryan: I have a course on money management that is 10-hours long.
It reflects a lot of what’s in the book and adds to it as well. It’s really
designed to just give people as deep an understanding of the subject as possible. And
it’s not just about my method, but about money management in general. I want
people to have a good, broad understanding and then be able to make a decision
from there. I just try to talk about money management wherever I go. I do some
speaking every now and again. To be quite honest, it’s not too hard to get
traders’ attention because most everybody else just lightly touches upon money
management or else they totally ignore it. If anyone wants to find out about my
money management course, they can go go to:
https://www.smarttrading.com/

Eddie: Thank you Ryan.

Ryan: My pleasure.