Money Management As An Edge

Let's talk about money management as an edge, using risk to reward ratio. Thought's, opinions, insight?

Money management itself does not gives you an edge in the market. But if u already have a winning strategy, it can help to optimize the results of your strategy, it's an edge in this sense.

well, i have found that if one has a winning strategy , lets say a 70% success rate, it becomes hard to increase the RR ratio above 1.
and in my extensive demo experience , the only time my money has grown consistently, even with a 65% win rate, is when i martingale. in this sense money management can turn the leaf in your favor.
i know the risk associated with martingaling, but somehow i always seem to fall back upon it.

High win rates are usually the result of taking profits quickly with a smaller risk-to-reward ratio. Lower win rates while seemingly less profitable often result in higher ROI year-over-year.

It really doesn't matter except to your personal way of relating to the markets. If you can stomach a lower win rate (if it won't mess with your discipline) then holding for larger profits will usually result in greater gain.

The real trick is not using money management to gain an edge. It is using money management to control losses. Every method looses. If yours looses more (comparatively speaking) then obviously you'll want to keep those losses smaller, and ride the winners as far as you can.

I'm also a fan of scaling out of trades to lock in profits, while at the same time keeping stops loose to as not to choke off your trades. This too is part of your money management policy, when, where and how to take profits off the table so as to maximize your wins.

In my opinion (such as it is) martingale when applied to a volatile market like FX, is a loser's policy.