11. Money Management & Position Sizing

How do I calculate the number of turbo certificates (derivatives) to buy?

There are two recommended approaches: method 1 and method 2

Method 1 - Risk-Based (Precise): The 1% Rule

Determine how much capital you are willing to risk per trade (e.g. 1% of €10,000 = €100).
Calculate the maximum loss per unit (e.g. entry price: €5, stop price: €3 → loss per unit = €2). This €2 loss corresponds to a 2% stop level on the DAX.
Formula:
Number of units = Maximum risk / Loss per unit
→ €100 / €2 = 50 units

Method 2 - Capital Allocation (Practical for Daily Use)

Divide your total trading capital into five equal parts (e.g. €10,000 → 5 × €2,000).
Select a product with a defined leverage, e.g. leverage of 5.
With a 2% stop level on the DAX and leverage of 5, the product carries a 10% risk.
Resulting maximum loss = 10% of €2,000 = €200
Formula:

Number of units = €200 / Entry price of the turbo

Both methods are valid. Choose the approach that best matches your risk tolerance, experience level, and trading style.

Exit Strategy & Trade Monitoring

How long does a position remain active?

Each trade has a maximum holding period of 5 trading days, starting from the entry date. If the position is not closed earlier by hitting the stop-loss, it should be closed manually on day 5.

How do I keep track of multiple open positions?

We strongly recommend maintaining a personal trading journal. This helps ensure clarity, consistency, and discipline. Your journal should include:

Entry date
Trade direction (Long or Short)
Product identifier (WKN)
Number of units
Entry price
Stop-loss level
Time-based exit (day 5, specific time)
Actual exit date and trade result

Maintaining a journal gives you full control over your positions and helps improve long-term trading performance.

Portfolio management

As five signals can be active at the same time, this must be taken into account in your individual portfolio- and money-management.

Example:

If an investor is prepared to take a total risk of 2.5% of his portfolio with this trading strategy, he will take a maximum risk of 0.5% per daily signal.