Volatility = your sizing guide. More volatile = smaller position. Simple.
Most people get this backwards. They see something pumping and go all in. Then they see it dump 40% and panic.
Risk tolerance is personal, but the math doesn't care about your feelings. If you can't handle a 50% drawdown, don't put 50% of your port into it.
Most people get this backwards. They see something pumping and go all in. Then they see it dump 40% and panic.
Risk tolerance is personal, but the math doesn't care about your feelings. If you can't handle a 50% drawdown, don't put 50% of your port into it.