I am struggling to write my onw trading plan

[oilman5]

Hi Dan,aw10.................u r not supplying food,...........let them come to water.
.............................................
Aha its a joke!!!
Yes planning .........right or wrong is more IMP than TA.
Objectively...........i in my first 10 yr of learning, i dont have a trading plan. So that 10yr , various experimental/losing trade r my marking time as trade learner.
Another imp aspect : why u fail to act AS PER PLAN..............reality ; practical application vs U , the trade dreamer

 

[DanPickUp]

Hi

To write down a trading plan is not every body's cup of tea. I am clear about that. So, why then make it when others trade with out it ?

There is a number of failing traders all over the world and this number starts with a 9, as most of us in the main time know. That quote is ex trimly high and has his legitimacy. I guess, in no other kind of business are so many dreamers and want to make quick money minds around like in trading. I think, it was Savant Garde, which explained it like this : If most of the existing doctors would educate them selfs as most of traders do, there would be many dead patient all over.

What reasons could be found to say : Yes, I see the necessity behind it and that is the reason, why I want my trading plan ?

I will leave it mainly to the reader, to find for him self the reason, what can motivate him to write this trading plan. If you ever trade with a plan, you will experience, that your emotions and stress levels will come down in certain moments, as you have a clear defined guide to solve a situation you are in. If you have more trading experience, you had more trading plans and you have more situations captured in your brain, which have clear acting rules.

An other part to look at is this : All this failing traders have one thing in common : They make mistakes ! You may now shake your head and say : Wow, what an answer. You not have to tell us such stupid things. We all know that :lol:.

So, ok. I then ask you : Are you belonging to that amount of traders, witch starts with a number from 1 till 10. If not, why ? You know the failing traders make mistakes and you not belong to the winners !

I not can give you any guarantee, that you will come there with a trading plan. But try to find all the weak points, the failing traders do and try to avoid them. So, if you have a trading plan, there are many others which not have any and you will have an advantage already over that traders. This may are 20 %or 30 % or what ever and you already have an advantage over them . There is much to write about having advantage over other traders, but this is not the thread to do so. Just one last example : If you have enough sleep and healthy food, you have an advantage over those traders, which not have enough sleep and healthy food. You can continue the list by your self.

Now to the next part of the trading plan :

Point Nr. 2 Basic Trading Parameters :

What markets you will be trading and on what time frames, maximum monetary risk per trade, average profit per trade, percentage of winning trades and your normal trade size

Again, keep it short and remember, it has not to be perfect. You may already recognized, that you thought about your first part you wrote down and you may already have edited it with some adds, you thought it is needed, or you even deleted some stuff to change it with other items. So it will be with every part you write down. It is a continuing process which you have started.

Take care and post when ever needed.

DanPickUp

 

[DanPickUp]

Hi

Stuck with that items ?

- What markets you will be trading
- What time frames will it be
- Maximum monetary risk per trade
- Average profit per trade
- Percentage of winning trades
- Trade size

The markets you will be trading should be choose d in conjunction with the time you can invest in trading and in conjunction with the derivative you want to trade ( Stocks, futures, options, ETFs or what ever ). To know this kind of mental setup is very important to all the small retail traders, which some of them some times think they are already in the business. I can tell you, that bigger boys, which work for a company, have other resources. They also have people around them which are trading for years and the communication in those teams is part of there power and success. Further more, they have daily meeting, in which strategies and trading mistakes are the discussions and so on. Most of you are not in a team and have to make decisions by being aware of that circumstances. As a beginner with little time and knowledge you should choose only one market.

If you have a job and do trading beside that job, you should choose a bigger time frame. All the rest is a road down to hell and suffering of losses and bad feelings about trading.

Maximum monetary risk per trade ? What amount of money do you want to risk, when you buy a share or what ever.

Profit per trade. Sure, as much and quick as I can. Write down how much you expect to make with each trade you will make.

% of winning trades. If you think, that every trade must be a winner, you have to write down : 100 %

Trade size. How much money do you think you will invest in each trade. Do not get confused with the maximum monetary risk per trade. There you say how much you want to risk and here you say how much you want to invest in each of your trades.

Example as continues and combined with part one :

As I want to trade stocks and not have to much time for trading, I want to invest in Bank Nifty. So Bank Nifty is my market.

As I work as a software producer, I can not spend all day long in front of a screen. I will choose a time frame of a week, so I can over think my trades over the weekend and make new trading decisions for the coming week.

My maximum monetary risk per trade ? Oh, I have a lot of money from my family and so I will risk ........................R per trade. As a logical result :

As I risk bigger amount of money, I will make bigger profits and so I think I will make an average of .............R per trade.

Percentage of winning trades : I am not sure about that, but as my friends tell me, that I am clever, I will have a rate of .......% winning trades.

My trading size will be ..................R, as it must be bigger as my risk size.


That's it. If this is a good example here, we will see in the coming parts.

DanPickUp

 

[IAtma]

this much of long long posts......::!:!
I will be crazy if I read........

m much better even without a plan.

:lol:

Food is coming, let us wait :lol:

:lol:

Yes planning .........right or wrong is more IMP than TA.

Another imp aspect : why u fail to act AS PER PLAN..............

:clapping:

reality ; practical application vs U , the trade dreamer[/B]

:beer:

 

[IAtma]

I will be going to Mumbai by plane.....will reach in 2 hrs.....

OMG, what if I miss the plane.......

not a prob at all, will go by train......

but it will take 2 days.........

and wha if the train became five days late or plane crashed/hijacked.....:!

what to do.......?:lol:

 

[DanPickUp]

IAtma

What do you want ? If you want me to stop the thread, so it will be.

All the best

 

[IAtma]

No, Pl. continue.:thumb:

What I want u keep it simple.

The long history/geography/philospy never work.

Trading is simple and keep it as it is.

IAtma

What do you want ? If you want me to stop the thread, so it will be.

All the best

 

[AW10]

No, Pl. continue.:thumb:

What I want u keep it simple.

The long history/geography/philospy never work.

Trading is simple and keep it as it is.

IAtma, if you think trading is simple then plz trade that way.
In my opinion, it becomes simple after sufficient struggle. All traders who adopt simple trading in initial days (without any planning, no risk mgmt, no trade plan, no strategy) becomes the part of the camp of loosing traders.

But there are people who understand the importance of planning and take trading seriously. Let them continue here.
All successful professionals (be they in Market Wizard or any other profession) put good planning as first step to success. If you want to discuss importance of planning, then please open new thread.

@Dan - plz continue.

Happy Trading

 

[DanPickUp]

No, Pl. continue.:thumb:

What I want u keep it simple.

The long history/geography/philospy never work.

Trading is simple and keep it as it is.

Hi IAtma

As I see, you are a member since 2008. How many post from different people have you seen since then, which just jumped in the market with now idea of nothing and then suffer from losses.

Trading education would have helped them. I do not say, that they not would have made losses, as in trading losses are natural. But if only a few of this people would have had a little more knowledge about what they do and how to handle it, there would be a few more less people, which would have lost as they did.

You can make trading simple in different ways. We are here in the beginner section and not in the advanced strategy section. If a beginner wants trading to make or be simple, he has to have a set of rules and solutions, which he can start with. That will be the guideline for him as a starter. As more experienced he becomes with that set of rules. as more he will transform to be able to make judgment calls and trade with tactics. But such levels must be out worked and this takes time.

My intention here was to show some mistakes made from members here in the past. I can give you a fix trading plan and say, now go and do it. But for this, you do not need to use this thread and it is not my intention to do so. There are so many concepts and plans here in Traderji. There is no need of one more.

In my opinion, it is more of a need, that beginner are able to recognize better, what they have to look at and what they can use for them selfs and what is realistic for them. If done in a serious way, this takes some time and needs some reading and thought by each one. If this is too much for the reader here in this thread, then he may look for an other thread or he takes his time to wait for what is coming. The thread was started two days ago and we are now by part two of the process. Six parts are planned. If this is to much for some readers, then please start your own thread with that subject and do not undermine this one, even I welcome constructive discussions.

DanPickUp

 

[Sunny1]

If you dont mind. The above post you have written certainly will complicated specially for beginner..I wish they would be more simpler. Above post I can digest now because i have spent 2 years at studying and trading market but if I had read it 2 years ago as beginner I would not have understood at all.

what I want now is that Dan, you should continue write all this and than Aw10 should make simpler for beginners. As everybody know here that Aw10 is expert at making things simpler and his writings is also very much easy to understand and grasp the subject matter.

If you dont feel that idea good enough will delete this post