Defining Risk | Bitcointalksearch.org

Kotone

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

I suggest you make a journal and try it for yourself. It really depends on the risk per person not on the exchange or anything. There's really number of ways to automate your computations in spreadsheet for you to workaround that will benefit you in the future trades.

Strongkored

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I do not use spreadsheets to record all my trading activities when to enter and when to cut losses, I only use a 5-10% ratio of my ability to lose so when I already bought and the price dropped then when touched 5-10% I will stop loss or cut loss, but I don't always use in all my trades.

Secionz

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Quote from: Deagle21 on November 17, 2018, 05:08:20 PM

I personally did not use such a table, but after reading this topic I decided that it would be a very convenient idea. if anyone can share something write in the PM. I will be grateful

I believe there is no need to have such a table or spread sheet to get things done in a good way but rather to be curious about the fact that if you do not diversify, you can lose big for not diversifying and for incurring loss in one single coin in which you have invested if the market for it falls.

fasdorcas

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

When it comes to taking risk on every trade, based on your signal, whether you are buying based on price action on some support level or so, you really want to be measuring your risk, which at this point is what you are going to be sacrificing based on your stop loss, and the potential reward you are going to get from that trade, and in no way should you ever let your risk be more than your reward in any trade you are entering at all. That in essence, is what is referred to as risk management when it comes to trading, so in that way, you are at least taking a calculated risk.

Reid

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Yes and No.
I dont even have any tormula in my spreadsheet.
I do use it just to list all the coins that I have and links on how to find them and their websites.
That's it.
Some of them have different prices so better check that too.
It will be much confusing if you put formulas in it since they are all using different exchange.
Monitor and just manual checking.

Jahmal32

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

Yes, the table in my opinion is unnecessary. Keep a table for transactions is normal, but also bother to risk and stop loss. You must have this table in your head. From each transaction a certain risk and percentage that you can lose. Also from your total Deposit. It's simple, nothing to be wise

MahalQu2612

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In my perception, every business in the entire world has risk involve. Meaning, if anyone want to engage themselves in business they must be ready for the consequences and I don't see any business were money is not involve of course money is always there, that's why there is risk. You are gambling your capital into business were there is a chance you can earn or loss your money.

deepaksharma

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This is not necessary to keep the spreadsheet.Keep this simple thing in mind " don't put all your eggs in one basket". Anyway there will always be risk in trading no matter how professional you become.

eminemcookie

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Quote from: Pursuer on November 17, 2018, 05:42:54 AM

the thing about loss in trading is that the amount does not matter in my opinion. what matters most is why that loss happened. for example if the loss was an unexpected market movement like the recent dip then it is ok to experience such loss and the size of it doesn't matter much. but if it was because you made a mistake and fell for some fake hype in some altcoin and bought into its bubble and got dumped, then that kind of loss is unacceptable no matter how much it is .

I both agree and disagree, while long term if you can avoid the unacceptable losses you spoke of, you'll have the most success. The size of loss does still matter, you may not be able to predict certain market movements but you can insure yourself against them with proper loss management. At the same time, if you do make a mistake and invest in a shit coin, it's again ideal to limit your losses where possible and it presents a learning situation that can help you to get better results in the future.

Deagle21

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I personally did not use such a table, but after reading this topic I decided that it would be a very convenient idea. if anyone can share something write in the PM. I will be grateful

creeps

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

Don’t be confused about the exchange rate try to focus on at least top coins and when it comes to the crypto exchange better to use also the top exchanges, the fees may be high but you are guaranteed that they are providing a good technology and a quality service.

Choosing the right exchange is important but don’t forget to study more about the market because no matter how good the exchange is, if you don’t know how to trade well I think its useless.

Pursuer

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Quote from: Reatim on November 17, 2018, 04:31:47 AM

Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

I guess you can research if such tools or apps exist. If I remember it correctly, there was quite a few but personally I don't used them because I'm just a casual trader.

I guess a 5%-10% loss is a good thing to start, but then again, people have different risk appetite and risk mitigation so its really up to you.

the thing about loss in trading is that the amount does not matter in my opinion. what matters most is why that loss happened. for example if the loss was an unexpected market movement like the recent dip then it is ok to experience such loss and the size of it doesn't matter much. but if it was because you made a mistake and fell for some fake hype in some altcoin and bought into its bubble and got dumped, then that kind of loss is unacceptable no matter how much it is .

dunfida

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Quote from: Reatim on November 17, 2018, 04:31:47 AM

Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

I guess you can research if such tools or apps exist. If I remember it correctly, there was quite a few but personally I don't used them because I'm just a casual trader.

I guess a 5%-10% loss is a good thing to start, but then again, people have different risk appetite and risk mitigation so its really up to you.

We wont really tend to make use of those tools or spreadsheets exist but I don't really see that someone do bother to create just to share on his ways
We do really have different risk appetite as you say so it would always differ.Following someones risk management isn't bad but it might not really work on you.

Reatim

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

I guess you can research if such tools or apps exist. If I remember it correctly, there was quite a few but personally I don't used them because I'm just a casual trader.

I guess a 5%-10% loss is a good thing to start, but then again, people have different risk appetite and risk mitigation so its really up to you.

owengtam09

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Quote from: jatin729 on November 14, 2018, 11:12:11 AM

Risk is nothing it is just threat whether you are into crypto market or any other investment schemes. There is an advantage of taking risk if you take risk than there will be probability to earn money or loss money. Risk is just a probability of having good results.

If you are a risk takers then there would be no problem because you know already the possible result of that taking risk, but to those who don't like to take risk then it is not recommended to them to just invest or trade on something that they are not sure especially if they don't know exactly how to do it.

selardkinley

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Quote from: SUDARMONO on November 13, 2018, 05:26:49 PM

determining such risks is indeed very confusing and I also use spreadsheets and it's a bit very profitable, but here I don't want to share my spreadsheets.

Risk is the presence of an element of uncertainty that is contradicting with your expected outcome of investment. It is a function of many factors and could be greatly reduced as well.

eminemcookie

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Quote from: faceoff97 on November 15, 2018, 06:14:51 PM

Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

There were platforms available you could use to compare the price of each coins from major exchanges. This allows you to even get profit and remove all the potential losses. Try to check out Bitsgap, its a new platform offered for free. Try it while its free of subscription, they will apply fee next year after seeing good development. After trading be reminded not to store or hold your funds in exchanges for longer time, it would be better if you'll transfer it to your main account. I recommend you to choose an open source wallet like Hodler wallet which is the only opensorce multiasset wallet available.

This is nothing to do with what the thread is about. Arbitrage is an entirely separate thing to trying to define and calculate risk. You should go and shill somewhere else.

faceoff97

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

There were platforms available you could use to compare the price of each coins from major exchanges. This allows you to even get profit and remove all the potential losses. Try to check out Bitsgap, its a new platform offered for free. Try it while its free of subscription, they will apply fee next year after seeing good development. After trading be reminded not to store or hold your funds in exchanges for longer time, it would be better if you'll transfer it to your main account. I recommend you to choose an open source wallet like Hodler wallet which is the only opensorce multiasset wallet available.

eminemcookie

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Quote from: digitalc on November 15, 2018, 11:47:31 AM

This notion of "normalising" i was missing. Im out at the moment but will be playing around with that in the spreadsheet next time i get chance. Thank you for taking the time.

Yep, that's pretty key to making things a lot more simple, you can do it at any point but it's always easiest at the beginning to save any confusion.

You're welcome, let me know if you need anything to be clarified. I think I got just about everything and it should be easy to grasp but of course that's from my own perspective Cheesy

digitalc

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Quote from: eminemcookie on November 14, 2018, 03:21:28 PM

Quote from: digitalc on November 13, 2018, 02:38:18 PM

Perhaps an example

Say I think DASH is likely to go up from a current price of 0.02519, but if I'm wrong I want to bail at 0.0249, with a view to selling the trade at 0.0259 if I'm right.

So my stop loss is to be set at 0.0249 and lets say I'm comfortable risking $100. What quantity would I buy at 0.02519 and stop at 0.0249 for that risk to equal $100?

Okay, so first step normalize what currency you're spending/thinking about. So let's make 0.02519 = 151.14 (I used $6000 for bitcoin price for simplicity) and the same for 0.0259 = 155.4 and 0.0249 = 149.4.

So: Price = 151.14, stop loss equals 149.4 and target sell price =155.4

Subtract the price from the stop loss price - 151.14 - 149.4= 1.74

Then divide that by the original price to get the percentage loss in decimal form (if your stop loss is hit) 1.74/151.14 = 0.0115 (rounded to 3 decimal places) or about 1.15%

Now the last stop is dividing your desired risked amount $100 by 0.0115- 100/0.0115=8695

So you could invest $8695 dollars, or 1.45 btc (if price was $6k)

If you also work out the upside, that is when the price hits the sell price of 155.4 dollars, you'd make $4.24 which is a 2.8% profit (0.028 in decimals).

Dividing 0.015/0.028 you get 0.53. Which means that the price would have to hit the sell price 53% of the time for you to make a profit in the long run.

I hope all that helps.

This notion of "normalising" i was missing. Im out at the moment but will be playing around with that in the spreadsheet next time i get chance. Thank you for taking the time.

eminemcookie

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Quote from: digitalc on November 13, 2018, 02:38:18 PM

Perhaps an example

Say I think DASH is likely to go up from a current price of 0.02519, but if I'm wrong I want to bail at 0.0249, with a view to selling the trade at 0.0259 if I'm right.

So my stop loss is to be set at 0.0249 and lets say I'm comfortable risking $100. What quantity would I buy at 0.02519 and stop at 0.0249 for that risk to equal $100?

Okay, so first step normalize what currency you're spending/thinking about. So let's make 0.02519 = 151.14 (I used $6000 for bitcoin price for simplicity) and the same for 0.0259 = 155.4 and 0.0249 = 149.4.

So: Price = 151.14, stop loss equals 149.4 and target sell price =155.4

Subtract the price from the stop loss price - 151.14 - 149.4= 1.74

Then divide that by the original price to get the percentage loss in decimal form (if your stop loss is hit) 1.74/151.14 = 0.0115 (rounded to 3 decimal places) or about 1.15%

Now the last stop is dividing your desired risked amount $100 by 0.0115- 100/0.0115=8695

So you could invest $8695 dollars, or 1.45 btc (if price was $6k)

If you also work out the upside, that is when the price hits the sell price of 155.4 dollars, you'd make $4.24 which is a 2.8% profit (0.028 in decimals).

Dividing 0.015/0.028 you get 0.53. Which means that the price would have to hit the sell price 53% of the time for you to make a profit in the long run.

I hope all that helps.

jatin729

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Risk is nothing it is just threat whether you are into crypto market or any other investment schemes. There is an advantage of taking risk if you take risk than there will be probability to earn money or loss money. Risk is just a probability of having good results.

MWesterweele

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Quote from: Indamuck on November 14, 2018, 08:19:53 AM

We won't get anywhere in life without taking some risks. Some risks have a bigger downside than others but in the crypto world the risk can be enormous. A lot of coins have dropped over 90% any may never recover to their previous highs. I'm well suited for this anyways, we all die in the end so we might as well roll the dice and try to strike it big.

Risks are those things that you may experience difficulties but these are also the things that you can learn a lot from which you can apply to another happening in you're life with similarity to it. Taking risk doesn't mean putting yourself in danger, it is teaching yourself to be braver enough in facing anything which you aim to have. And as you take it, even if you fail while taking a risk, yes you have failed it but you have learned from it.

Babyrica0226

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

Risk will always be a part of it dude,. Now if will become neglectful there's a tendency you will face a higher risk. But if you will become careful about it, I think you can minimize your risk as well. I know time will come if you will explore yourself here more, for sure in the end when you play in the market you will learn a lot of things in it. You can make your own methods when you do trade in the platform.

dothebeats

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Risk management is something an individual should assess themselves and should not be asked from anyone since every one of us have our own risk tolerance. Personally, I just check a coin, see its performance in a 3-month period and decide what portion of my capital would I allocate. Moreover, performance of the coin in the market alone isn't enough; I should also know the state of its community and whether or not there are active developments going on within the coin or it's an abandoned project. Knowing all these, you will have less time to worry about figures since it will come naturally once you know the state of an asset you're going to put your money to.

omonuyak

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Quote from: SUDARMONO on November 13, 2018, 05:26:49 PM

determining such risks is indeed very confusing and I also use spreadsheets and it's a bit very profitable, but here I don't want to share my spreadsheets.

I don't think anybody will like to share their trading strategies with us and how there manage they risk in trading. I believe that many of us need to define our risk and how to manage it in trading. I make my, simple to understand and that is, I will never invest more than I can afford to lose so my reward is not always much and if I lose the loses is always very minimal.

Indamuck

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We won't get anywhere in life without taking some risks. Some risks have a bigger downside than others but in the crypto world the risk can be enormous. A lot of coins have dropped over 90% any may never recover to their previous highs. I'm well suited for this anyways, we all die in the end so we might as well roll the dice and try to strike it big.

charlotte04

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

I do use a spreadsheet for all of my tradings and I could see how I do for my tradings and finding all of my mistakes and trying to avoid it and do better for the next time.

eann014

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

We have our own strategies and I don't think. Professionals will just keep their knowledge and use their strategies to make money. I mean, if you want to learn strategies in trading then you must pay first before they give their copies of spreadsheets or share their knowledge.

SUDARMONO

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determining such risks is indeed very confusing and I also use spreadsheets and it's a bit very profitable, but here I don't want to share my spreadsheets.

digitalc

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Perhaps an example

Say I think DASH is likely to go up from a current price of 0.02519, but if I'm wrong I want to bail at 0.0249, with a view to selling the trade at 0.0259 if I'm right.

So my stop loss is to be set at 0.0249 and lets say I'm comfortable risking $100. What quantity would I buy at 0.02519 and stop at 0.0249 for that risk to equal $100?

eminemcookie

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As stomach said, everyone has their own way of defining risk. You need to ascertain your own risk criteria and also understand how different coins have different levels of inherent risk. From there you can work out a calculation similarly to how he did it. I personally don't aim to risk more than 5% of my entire holdings at any one time.

stomachgrowls

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Quote from: digitalc on November 13, 2018, 12:53:16 PM

I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

Such calculations are just being created solely by individuals who do involve their-selves into trading which we known that each person do have different
risk management yet we do have different amount of money that we can put on each trade order basing on our entire trading wallet balance.

Lets talk about my own risk:reward ratio example. Im not really fan of using up stoploss because it do leaves me hanging on negative when the market is way too volatile
unless if i do make shorts where scalping out a few profits gradually then this tool will be effective.Just an example you set out 10% stop loss on an order and you have used
up 3% of your capital lets say you have $1000 each trade cost up $30.

roosbit

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Random coins :)

Spreadsheets not necessarily, you just have to know the general performance of that coin you interested in...if possible dig up it's ico price and all its related data so that it guides you were to set your stop loss orders and the buy orders. Sometimes speculation overwhelms these rules and you just have to follow the wave.

digitalc

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Yes, I understand my risk appetite in fiat, but what I find confusing is calculating that risk appetite in figures pertaining to cryptocurrency prices.

palle11

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I think you the one who understands your risk appetite, you know how much you want to shake and I guess you also have to adjust your risk in stop loss by yourself, except there is an app that does it automatically... Well, yet to be aware of that.

digitalc

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I find it confusing defining risk in fiat when looking to place a trade due to the numerous exchange rates. Does anybody use a spreadsheet which does all the calculations for them upon entering price, stop loss and desired risk in fiat?

If yes, would you be willing to share the spreadsheet which you use?

Topic: Defining Risk (Read 481 times)