How Much Cash Should You Have In Your Brokerage Account?

One of the most important things to establish for any trader is how much money you should keep in your account. While this depends on the type of trading and experience one has, here at YellowTunnel, our strategy is rooted in statistics and statistical analysis- not emotion. What we are looking for, and what most traders aim to achieve, is the highest probability of success with the lowest investment capital. Statistically speaking, you can determine what range a stock should be trading in, and with our neural networks we can also predict the direction. However, it is nearly impossible to predict ‘black swan’ events and therefore one should always be ready with a good trading plan- which includes a defined amount of free cash, we suggest on average 30% of your account should be in cash, in your brokerage account.