Contents:
- Adjustments to Our Strategy for BETA
- Updated Trading Scenarios for BETA
- Why BETA Matters
- Key Takeaways for BETA
- Final Thought
As part of our ongoing refinement of the Modified 10-Step Trading Plan, we have launched the Budget Ethical Trading Account (BETA). This account is dedicated to live-testing our trading strategies with a smaller, focused position. For the time being, we will set aside our primary account holding 1,500 shares of URC and shift our focus entirely to BETA, which starts with a manageable 210 shares of URC.
The purpose of BETA is to concentrate on the active trading aspect of our strategy while keeping our risk exposure minimal. With this account, we aim to continue exploring small position sizes, tactical entries, and core positions in a real-world trading environment.
Micro Stock Trader Budget Ethical Trading Account (BETA).
Adjustments to Our Strategy for BETA
Given that BETA starts with 210 shares of URC, we have made the following adjustments to our position sizing and risk management strategy:
1. Position Sizing for BETA
Since the total number of shares in BETA is 210, we will scale our tactical and core positions accordingly:
Core Positions: 50% of trading shares → 100 shares
Core positions in BETA represent half of the total account and are used for medium-term trades when we have high confidence in a setup.Tactical Entries: 10% of trading shares → 20 shares
Tactical entries are smaller, speculative trades used to test the market during uncertain periods or near potential reversal levels.
This scaling ensures that we maintain the same proportionate approach as in our main account, but with a smaller capital base.
Updated Trading Scenarios for BETA
Scenario 1: Testing Key Support Levels
If URC approaches a key support level, such as Php 70.50, we can:
Start with a tactical entry of 20 shares to test the market.
If the price holds and shows signs of upward momentum, we can add a core position of 100 shares, increasing our exposure as confidence in the setup grows.
Scenario 2: Profit-Taking at Resistance Levels
If URC reaches a significant resistance level, such as Php 73.50, we will:
Take partial profits by selling 50 shares, ensuring that we lock in gains while leaving some shares to ride further upside if momentum continues.
Use a trailing stop-loss for the remaining shares to protect profits while staying engaged in the trade.
Scenario 3: Stop-Loss Strategy
We will maintain a hard stop-loss at Php 67.75, similar to our primary account, to limit downside risk. If the price breaks below this level:
We will exit the entire position to preserve capital.
Tactical re-entry will only be considered if the price stabilizes and forms a new support level.
Why BETA Matters
BETA serves as a controlled environment where we can test real-time applications of our trading strategy with lower risk. This approach allows us to:
Focus on Execution:
With a smaller position, we can concentrate on fine-tuning our entry and exit strategies without the emotional burden of managing a large position.Improve Tactical Decision-Making:
BETA helps us refine tactical entries and exits, especially during high-volatility sessions, ensuring that our strategy remains adaptable to different market conditions.Document and Learn:
Every trade in BETA will be documented meticulously, allowing us to gather insights and lessons that can be applied to our primary account once the testing phase concludes.
Key Takeaways for BETA
Position sizing has been adjusted to fit the smaller scale of BETA, with 100 shares for core positions and 20 shares for tactical entries.
The hard stop-loss at Php 67.75 remains a critical part of our risk management strategy.
BETA allows us to stay committed to disciplined execution while reducing risk exposure.
Final Thought
By launching BETA, we reinforce our commitment to refining the Modified 10-Step Trading Plan through disciplined, real-world testing. This focused approach ensures that we continue learning and improving while keeping risk under control.
Stay tuned as we document our progress with BETA, sharing key trades, lessons learned, and further adjustments to our strategy!
Would you like to follow our BETA journey? Keep checking in for our latest updates as we put theory into practice!
Disclaimer: This post is for informational purposes only and should not be considered financial advice. Always do your own research before making any trading decisions.
Related Readings
Micro Stock Trader: Week 2 Trading Update: Detailed Assessment and Outlook
Micro Stock Trader: My Stock Trading Plan: Inspired by Oliver Velez’s 8-Step Strategy
Micro Stock Trader Portfolio Tracker Page
Micro Stock Trader: Revealed: Our Top 3 Shariah-Compliant Stocks for a Winning Portfolio
