If you were starting your own business, you would normally put together a business plan – if you required bank or private finance this would be a requirement – but quite honestly even if it were your money, more especially if it were your money, you should prepare one too. So why do you think it should be any different with the business of trading?
Having a trading plan adds another layer of discipline, which is one of the most important aspects of trading. How much money have you lost on a crazy impulse trade for a share which you thought couldn’t possibly go any lower?
What should this trading plan contain? There is really no fixed format, but in order to give you a head start on the things you should consider including I am happy to share my classification with you, as follows:
· Strategy
· Profit Goal
· Position Sizing
· Daily Trading Plan
· Entries
· Stop Losses
· Open Positions
· Exits
· Grading
· Emergency Back-up Plans
· Record Keeping
This is not meant to be an exhaustive list, but this plan is better than more than 50% of other traders out there, because they don’t have one at all!
If you haven't yet found your perfect trading system, please check this one out!
Having a trading plan adds another layer of discipline, which is one of the most important aspects of trading. How much money have you lost on a crazy impulse trade for a share which you thought couldn’t possibly go any lower?
What should this trading plan contain? There is really no fixed format, but in order to give you a head start on the things you should consider including I am happy to share my classification with you, as follows:
· Strategy
· Profit Goal
· Position Sizing
· Daily Trading Plan
· Entries
· Stop Losses
· Open Positions
· Exits
· Grading
· Emergency Back-up Plans
· Record Keeping
This is not meant to be an exhaustive list, but this plan is better than more than 50% of other traders out there, because they don’t have one at all!
If you haven't yet found your perfect trading system, please check this one out!
RSS Feed
