Developing Your Own Trading Plan

All the great conquerors we know of never went to war without a plan; neither should a great trader.

Lessons in Developing Your Own Trading Plan

1. What is a Trading Plan?

   In creating a trading plan, make sure it answers four questions: What? Why? When? How?

2. Why Do you Need a Trading Plan?

   Simple. Failing to plan is planning to fail. Remember, 90% of new traders don't survive their first year of trading.

3. Justified vs. Unjustified

   Contrary to popular belief, the end doesn't justify the means. Let us explain why profiting despite deviating from your trading plan is still a loss.

4. Getting to Know Yourself

   Yeah, it may sound like a question on a Facebook quiz, but knowing yourself is critical in finding the right system.

5. Motivation and Goal Setting

   Good goals should be specific and realistic. Why?

6. Risk Capital

   How much money can you trade with? Can you afford to lose all of it? You don't want to risk what you can't afford to lose!

7. Lifestyle Considerations

   Your time availability will determine your trading style. How much time per day can you dedicate to trading?

8. Expectations

   Figuring out what kind of returns you expect to make plays a role in determining what type of trading strategy you should implement.

9. Daily Pre-Market Routine

   Your pre-market routine is critical to your success as a trader. Think of it as a warm up before you start going after those pips!

10. Weapons of Choice

    What software, hardware, and other tools will you use for trading? Don't forget to think of your backups as well.

11. Stick to the Plan

    Your trading plan should be tailor-fit to your goals, risk tolerance, and lifestyle. Stick to it at all times!

12. Summary: Developing a Trading Plan

    No matter how good your trading plan is, it won't work if you don't follow it. Check out the benefits of having a trading plan.

Forex Training in the School of Pipsology