Скачать или смотреть 0DTE Position Sizing How Much to Risk Risk Management System

0DTE position sizing and risk management system. This is video 4 in the "How to Profit from 0DTE Options Using Volume Profile" series (intermediate level). Learn why 0DTE requires different position sizing than multi-day options (binary outcomes, accelerated decay, no recovery time), the exact formula for calculating contract quantity (risk dollars ÷ risk per contract), complete stop loss system for 0DTE (price-based, percentage-based, time-based stops), daily and weekly loss limits that prevent catastrophic drawdowns, and complete risk management framework. This is capital preservation and survival.

📊 What's Covered:
0:00 - Position Sizing Prevents Blowups
0:20 - Series Context (Video 4 builds on Videos 1-3)
0:50 - Level 1: Why 0DTE Position Sizing is Different (Unique risk profile)
3:45 - Level 2: The Position Sizing Formula (Exact calculation method)
7:30 - Level 3: Stop Loss Placement for 0DTE (Three-stop system)
11:00 - Level 4: Daily and Weekly Loss Limits (Ultimate protection)
14:15 - Integration Framework (Complete risk management checklist)
15:15 - Practice Framework (This week's homework)
15:45 - Next Steps (Video 5 Preview - Trade Management)
Why 0DTE sizing is different: (1) Binary outcomes - options worth something or zero at 4 PM, no tomorrow for recovery. (2) Accelerated theta decay - final 90 minutes lose 15-25% per hour vs 2-3% for weekly options. (3) Volatility compression - same $0.50 move gives wildly different returns based on time remaining. (4) No recovery time - wrong at 3:30 PM means 30 minutes to recover vs 6 days with weekly options. Result: Must risk LESS per trade (0.5-1.5% vs standard 1-2%).
Position sizing formula: Step 1: Account size × Risk% = Risk dollars. Step 2: Identify entry price. Step 3: Determine stop loss (40-60% loss recommended). Step 4: Risk dollars ÷ Risk per contract = Maximum contracts (round down). Step 5: Verify total premium paid. Example: $25,000 account, 1% risk = $250. Entry $0.80, stop at $0.40 (50% loss) = $0.40 risk per contract. $250 ÷ $40 = 6.25 → 6 contracts maximum.
Complete example: $50,000 account, 1% risk = $500. Entry 450 calls at $0.70, stop at 50% = $0.35 remaining = $0.35 ($35) risk per contract. $500 ÷ $35 = 14.28 → 14 contracts. Total premium $980. Actual risk $490. If calls drop to $0.35 exit for planned $490 loss. If reach $1.40 (100% gain) exit for $980 profit (2:1 reward).
Three-stop system (use all three): Stop 1 (Primary) - Price-based: Exit if underlying breaks invalidation level (e.g., SPY 449.10 breaks support). Stop 2 (Secondary) - Percentage-based: Exit at 40-60% loss regardless of underlying price. Stop 3 (Final) - Time-based: Exit by 3:30 PM regardless of P&L (final 30 minutes too unpredictable). Whichever stop hits first, exit immediately. No hesitation, no waiting for bounce.
Daily loss limits: Conservative 1.5%, Moderate 2%, Aggressive 3% of account. NEVER exceed 3% daily loss. Example: $50,000 account with 2% daily limit = $1,000. After losing $1,000 in day (whether 2 trades or 5), STOP trading, close platform, walk away. Prevents revenge trading spiral that turns -2% day into -8% day. One bad day without limit can destroy months of progress.
Weekly loss limits: Conservative 3%, Moderate 5%, Aggressive 7% of account. NEVER exceed 7% weekly loss. Prevents compounding bad weeks. Example: Lost 2% Mon, 2% Tue, 2% Wed = 6% week. With 5% weekly limit, stop trading rest of week after 5% loss Wednesday. Preserves capital, prevents 10%+ weekly drawdowns that require 11%+ gains to recover.


📚 SERIES PROGRESSION:
✅ Video 1: The Complete 0DTE Options Strategy (System Overview)
✅ Video 2: How to Identify the 0DTE Pin Zone (POC + Value Area Method)
✅ Video 3: When to Enter 0DTE Options (Exact Timing + Price Action Triggers)
✅ Video 4: 0DTE Position Sizing: How Much to Risk (Risk Management System) [YOU ARE HERE]

⏳ Video 5: Complete 0DTE Trade Management (Entry to Exit) - [COMING NEXT]
⏳ Videos 6-8: Advanced applications and specializations...

🔔 SUBSCRIBE to Elite Trade for institutional trading education

📈 Prerequisites (Must Watch First):
→ How to Profit from 0DTE Options - Videos 1-3 (Required Foundation) -https://studio.youtube.com/video/niR2...

DISCLAIMER: This video is for educational purposes only. Options trading involves significant risk and is not suitable for all investors. 0DTE options can result in complete loss of invested capital. Trading involves substantial risk of loss. Past performance is not indicative of future results. All content provided by Elite Trade is for informational and educational purposes only and should not be construed as financial advice. Consult with a licensed financial advisor before making any investment decisions.

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