Risk Management - Fixed Amount

The Bullet and the Chamber: A Doctrine on Fixed-Amount Risk

In this section, in its most summarized form, you add a fixed margin size for which a position will be opened for each automatic trade.

Before a single dollar is deployed, the professional warrior answers a question the amateur never even thinks to ask: "How much am I willing to lose on this engagement and still be able to fight tomorrow?" The amateur, blinded by greed, only asks, "How much can I win?" This single distinction is the dividing line between a sustainable career and a spectacular burnout.

This section of the MEFAI interface is where you make that professional declaration. This is not a setting for your ambition; it is a tool for your discipline. We call it Fixed Amount risk. The mechanic is brutally simple: you will tell the machine the exact dollar amount of margin to use for every single trade it executes.

If your war chest is $1,000 and you enter $100 into this field, every signal MEFAI acts upon will be a $100 position. Not $90. Not $110. One hundred dollars. This removes the single greatest vulnerability in any trader's arsenal: emotion. There will be no euphoric "all-in" bets after a string of wins. There will be no timid, fear-driven position sizing after a loss. There is only the cold, mechanical consistency of your strategic plan being executed flawlessly.

The system has guardrails to protect you from yourself. If you command it to risk more capital than you possess, it will refuse the illegal order. If you command it to enter a trade with a size so small that it violates the exchange's own laws (the minimum notional value), it will refuse the pointless order. You must be aware of this, especially in the context of our profit-taking protocols. As detailed in other doctrines, the system is designed to close half of your position at Take-Profit 1 to secure capital. If your initial position is too small (we recommend a minimum of $20-$30 margin to avoid any issues), "half" of it may be an amount below the exchange's minimum tradeable size. In this scenario, the system will intelligently close the entire position at TP1.

Now, let us be unequivocally clear about what you are doing when you enter a number here. The figure you type is not the amount of money you are going to win. It is the amount of money you have calmly, rationally, and professionally agreed to risk. You are pre-authorizing the potential loss of this capital.

All of it? Of course not. Don't be absurd. You are forgetting that MEFAI is about to perform the single most critical task that you, in your emotional state of hope and fear, consistently fail to do.

It is going to place a stop-loss. A non-negotiable line in the sand. How that line is drawn is a science in itself, and we will dissect it in our next doctrine.