WY-06-28 / 09
Portfolio Correlation, Concentration, and Abnormal-Market Contingencies
Decisions, Execution & Validation
Lesson / WY-06-28
Multiple trades cannot be assessed only against individual budgets. Instruments may share an industry, index, funding currency, or seemingly different exposures that all depend on rising risk appetite. Low historical correlation in normal conditions does not ensure independence under stress; correlations change and several stops may simultaneously fill worse in a gap. Taking the square root of summed squared individual risks does not by itself establish diversification.
Course content is for learning and research only. It is not investment advice.
Read the Chapter ↗Timestamps
10 lessons · Chapter contents
01Analytical Bias, Trading Opportunity, and Entry Trigger↗02Tests, LPS/LPSY, Breakout Retests, and Trend Continuation↗03Early, Confirmed, and Retest Participation↗04Price Advantage, Information, and Potential Risk↗05Hypothesis Invalidation, Discretionary Exit, and Protective Stops↗06Market, Limit, and Stop Orders↗07Risk Budget, Unit Risk, and Position Sizing↗08Multipliers, Minimum Ticks, Currencies, Costs, and Nonlinear Products↗09Portfolio Correlation, Concentration, and Abnormal-Market Contingencies↗10A Complete Trading Plan↗Observe the market: start with context and place price within its structure.
Understand structure: compare supply and demand, and let evidence support or revise your hypothesis.
Form a view: define risk limits and know when to reassess.
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Relative Strength and Opportunity Screening
Point-and-Figure Charts and Price Target Estimation
