FIXED RATIO TRADING

The next several chapters thoroughly explain, discuss, and illustratethe Fixed Ratio trading method. This method came as a direct resultof researching and breaking down the Fixed Fractional method. However,it is not the same. Some will say that a fixed fraction and a fixedratio are the same thing and therefore, the two methods are the sameas well. This reasoning is as superficial as judging a book by its title.Bear is also spelled bare but the words have completely differentmeanings, and if I were to say “bear” without any context, youwouldn’t know whether I meant bear or bare. Likewise, the termsFixed Fractional trading and Fixed Ratio trading are similar but representdifferent concepts.If you have skipped Chapter 5, I highly recommend that you goback and read it now. Even though the Fixed Ratio method is completelydifferent in functionality and every other characteristic, itwas developed as a direct result of breaking down the former method,isolating the pros and cons as well as the causes of each. Understandingthe Fixed Fractional method will help you understand not onlythe mechanics of the Fixed Ratio method, but also why it is the onlypractical money management method available.