The Trade Won't Kill Us. Our Ego Will.

You asked for it. Here it is.

Jul 31, 2025

Today I want to talk about something that every trader needs to internalize—not just as a concept, but as a discipline:

A 20% move in copper—or any asset—should never make or break your portfolio.

That’s not a suggestion. That’s a survival rule.

Great traders don’t survive because they’re always right. They survive because when they’re wrong, they’re wrong small. They size for volatility. They position with discipline. They never let one trade define their year—let alone their career.

So let’s break it down.

Position Sizing: The Only Real Risk Control

Let’s say you manage a $100,000 trading account. You want exposure to copper because you believe it’s entering a bullish trend. Great. But how much do you allocate?

A common mistake: putting in $25K, $50K, or more. Why? Because the thesis feels strong. Because the chart looks clean. Because you watched a podcast that confirmed your bias.

That’s not trading. That’s ego with a brokerage login.

Instead, let’s keep it simple: risk 1% of your total portfolio per trade.

Not 10%. Not 5%. 1%.

“If you don’t bet, you can’t win. If you lose all your chips, you can’t bet.”
— Larry Hite, Market Wizards

The Copper Math: A $5K Position Example

Let’s go back to copper.

If you have a $100K account, and you want to take a position, here's a reasonable play:

Allocate $5,000 to the copper trade.
That’s 5% of your capital.
With a 20% drop in copper, the max loss on that position would be $1,000.
That’s 1% of your total portfolio.

And that’s the whole game.

You took a shot. You had a setup. It didn’t work. But you’re still alive.

You didn’t panic-sell your portfolio. You didn’t overleverage. You didn’t destroy your confidence or compound your losses with revenge trades. You took a hit. A planned, managed, survivable hit.

That’s what professionals do.

The Secret: Losing Small, Winning Big

If you’re trading for a living, you will be wrong often. The best traders in the world bat 50%—on a good day.

But the difference is, when they lose, they lose small. And when they win? They win big.

“The most important thing in making money is not letting your losses get out of hand.”
— Marty Schwartz
“It never was my thinking that made the big money. It was always my sitting.”
— Jesse Livermore

Staying alive is more important than being right.

Why This Matters More Than Ever

Volatility isn’t going away. In fact, we’re entering an era where macro themes, political decisions, and AI-driven flows are driving more unexpected moves—not fewer.

You can’t control the news. You can’t control the tape. But you can control your position size.

When copper drops 20%, it should be a note in your journal—not a financial catastrophe.

When crude gaps lower, or a tech stock retraces 30%, or the dollar breaks out—none of those moves should threaten your solvency.

Because if your position size is right, no single trade ever does real damage.

Final Word

The traders who make it? They don’t have magic indicators or perfect timing.

They survive.

And survival is about sizing.

Don’t bet the farm.
Don’t chase revenge.
Don’t blow up on one idea.

Risk 1%. Let winners run. Cut losers fast. Play the long game.

That’s how you stay in the game long enough to win.

Today I joined @marketminute Mish LIVE to talk about all things commodities, market cycles, bonds, and macro flow.

Who is Mish Schneider?

Michele “Mish” Schneider is the Director of Trading Education and Research at MarketGauge, a firm she’s helped lead for over two decades. She’s a former floor trader on the NY Commodities Exchange (NYMEX) and a well-respected voice in macro analysis, trading psychology, and intermarket relationships.

Mish is known for her ability to break down complex market structures into actionable insights. She’s the author of multiple books—including Plant Your Money Tree: A Guide to Growing Your Wealth—and a frequent guest on CNBC, Bloomberg, Real Vision, and other major financial outlets.

She brings a rare blend of trading experience, educator insight, and cycle awareness—making her one of the most versatile minds in the space.