I have been looking at position sizing lately and I do not understand something.

I am trying to run a backtest w/ the following settings. 5% of equity and 1.25 leverage. I run it and then I look at Trades and there are more than 50 Trades open. How can this be? Is it showing all the open positions in the Trades area but when it calculates the results it is not doing that? How do I find what it is doing because the results may be meaningless.

Does it reinvest the "proceeds" in a new idea every time there is enough new equity to do so?

Also how does this margin factor work. 1 to 1 means that you are investing 100 pct of the equity right?

1.25 to 1 means that you are borrowing 25 dollars for every 100 in equity?



Thanks.

No it doesn't reinvest "every time" like Metastock. Wealth-Lab scales position sizes based on changes to the portfolio equity level. If the open (unrealized) equity has increased, what's the problem in taking more new trades?

For Margin Factor description, see the User Guide, Reference > Data Panel > Position Size Control > Portfolio Simulation Mode > Margin Factor.