Position sizing refers to the process of deciding how much of an investment portfolio should be allocated to a particular asset or trade. It is an important aspect of investment strategy and risk management, as it helps investors to diversify their portfolios and limit potential losses. Position sizing can be determined based on various factors, such as an investor’s total assets, risk tolerance, and the specific risk characteristics of a given asset or trade. There are a number of methods used to determine position size, including percentage of portfolio, dollar amount, and risk/reward ratio.
Moneyness
Moneyness is a vital term in options trading that helps option traders understand the relationship between the price of an