Define Your Trading Plan

[rollotape 10]

There is a good audio on preparing a trading plan on Van Tharps website

 

 

Steps to Become A Great Trader

[jeanlee411 10]

In fact the trading plan is the first step to be a disciplined trader

 

Do you write your setup in your trading plan too ?

 

If some one can copy/paste the summary of a good and structured trading plan it will be very useful for beginners who want to write their first trading plan.

 

Thank you

 

__________________________

Watch Iron Man 2 Online Free

[HighStakes 10]

I agree that the template in Mastering The Trade by John Carter is a great starting point. High Probability Trading by Marcel Link also has some good stuff on writing a trading plan.

 

In my opinion, your trading plan should contain every aspect of your trading business:

 

- Why you are trading and what your objectives are

- When you will be trading

- What you will be trading

- How many contracts/stocks will you trade as a function of your account size

- Money management

- Drawdown rules (for example, stop all trading for the month after a 20% drawdown)

- Your trading system (this can be as simple as moving average crossover system)

- Notes and reminders regarding psychology

- A solid system for tracking performance on a daily, weekly and monthly basis

- A journal detailing your trades, psychology, general market comments, etc

- How you will start your trading day and how you will end it

- Trading rules

- Montecarlo simulations including commissions and slippage so that you can learn what to expect from various trading systems.

 

My current trading plan is over 10 pages and covers just about everything. Attached to the plan there are several spreadsheets that is part of the plan.

 

Writing my journal has really helped me pull together everything I`ve studied and learned so far. It has also revealed several weak areas that I`m now working on.

 

When my plan is complete, it should be so detailed and conscise that I could give it to anyone and they could understand and use it.

 

Trading without a plan is planning to fail

[william40mg 10]

Your tarding plan should include the following:

-Goals

-Markerts, instruments and the timeframes you are going to trade

-The tools you are going to use, eg any software or robots

-Risk and money management

-Trade strategies:- setups, entry and exit rules

-Discipline

-Folow ups and review.

[markl67 10]

I agree that the template in Mastering The Trade by John Carter is a great starting point. High Probability Trading by Marcel Link also has some good stuff on writing a trading plan.

 

In my opinion, your trading plan should contain every aspect of your trading business:

 

- Why you are trading and what your objectives are

- When you will be trading

- What you will be trading

- How many contracts/stocks will you trade as a function of your account size

- Money management

- Drawdown rules (for example, stop all trading for the month after a 20% drawdown)

- Your trading system (this can be as simple as moving average crossover system)

- Notes and reminders regarding psychology

- A solid system for tracking performance on a daily, weekly and monthly basis

- A journal detailing your trades, psychology, general market comments, etc

- How you will start your trading day and how you will end it

- Trading rules

- Montecarlo simulations including commissions and slippage so that you can learn what to expect from various trading systems.

 

My current trading plan is over 10 pages and covers just about everything. Attached to the plan there are several spreadsheets that is part of the plan.

 

Writing my journal has really helped me pull together everything I`ve studied and learned so far. It has also revealed several weak areas that I`m now working on.

 

When my plan is complete, it should be so detailed and conscise that I could give it to anyone and they could understand and use it.

 

Trading without a plan is planning to fail

 

10 pages! Some of ya'll obviously have bigger brain than me!

[william40mg 10]

I cant agree with you more.

[TheDude 10]

I find specific profit goals, whether expressed in nominal dollars, percent ROI or however to be of no value, and I do no such "goal setting." I have defined when I will enter, how I will manage, and when and how I will exit a position. I know how I will determine trade size, and most importantly, I know when I will quit. That really is all you need - what will you trade, when, how much, and when do you get flat and when do you stop the bleeding when it occurs.

 

Best Wishes,

 

Thales

 

I agree. Given that a good goal/target needs to be both achievable and challenging, I find financial goals lead to pressure to achieve those goals. This can manifest itself in creating pressure that results in taking sloppy trades to achieve those goals. This is idiotic in my opinion as you can not control the market, thus you can not control the frequency or magnitude of (your) opportunity. This can then lead to other problems such as beating ones self up for missing target.

 

A better solution for me is to set a goal that is behaviour orientated. e.g. to be in 75% of my trades. To make sure I cut losses quickly, or not to trade if feeling under the weather etc.

 

What we can do however, is have an understanding of the typical returns the strategy employed will generate over a week/month depending on frequency of opportunity. If those returns arent happening, then either the market cycle has changed (find another edge or adjust the current one), or we are not executing according to the plan (why?).

[kamnpap 10]

thanks, i am learning how to improve my plan.

[Obsidian 10]

Good Morning,

 

All profitable traders talk about their Trading Plan so I would like your advises to define my own Trading Plan.

 

But what is a good Trading Plan ?

And what must and must not be written in a Trading Plan ?

 

Thank you,

Steven

 

Examine the charts over the weekend. Draw-adjust fibos-trend lines. Check if there are new patterns and formations. Find possible trades on long-short time frames. Take notes about entry-exit points. Check eco calendar...