5 Key Questions To Save Your Trading Career
•Download as PPTX, PDF•
0 likes•250 views
Five simple questions asks traders to evaluate their trading plan by considering: 1) What conditions trigger a trade? 2) How will the trader enter the position? 3) Where will the stop loss be placed? 4) What percentage of the account will be risked on each trade? 5) What price actions will prompt the trader to exit, scale out, or adjust the stop loss. The document stresses the importance of having a clear trading plan to avoid relying solely on the ease and accessibility of online trading platforms.
Recommended
More Related Content
Viewers also liked
Viewers also liked (10)
More from NetpicksTrading
More from NetpicksTrading (20)
Recently uploaded
Recently uploaded (20)
5 Key Questions To Save Your Trading Career
- 3. P/L -
- 7. Where is your trading plan?
- 10. Is it the ease of turning on the computer and placing a trade?
- 11. Is it because you can do it from any place in the world with WIFI…including the beach?
- 12. Is it because the initial cash outlay does not have to be huge in order to start making money?
- 13. Psychological?
- 15. 1. What constitutes conditions for a trade? 2. How will you enter? 3. Where is your stop going to go? 4. What % of your account will you risk to see if this trade will be successful? 5. What price will you take action after the trade is entered? Will you exit? Scale out? Trail stop?
Editor's Notes
- 00:00:00 - (duration:00:00:08) - I am going to beat a dead horse. While I am not a huge fan of this analogy, it hammers home just how important these questions are.
- 00:00:08 - (duration:00:00:13) - On a daily basis, I receive emails and charts from traders. Most of them are using a discretionary form of trading however even discretion has certain variables that are needed to get into a trade.
- 00:00:21 - (duration:00:00:06) - These traders usually send in when trades didn’t go as planned and another set of eyes are always good to see if you went off your written trading plan.
- 00:00:27 - (duration:00:00:12) - Here is a recent email conversation: ME: “I think I can see why you took this trade but breakouts are usually a tough ride. Why did you take this one?” THEM: “Liked the candle. It felt right.”
- 00:00:39 - (duration:00:00:11) - Digging deeper I asked what the specific plan was for this particular trade. Specifically I asked how did the candle have to look to consistently take these types of trades.
- 00:00:50 - (duration:00:00:02) - He didn’t know. That is the problem.
- 00:00:52 - (duration:00:00:15) - People will write out a shopping list but will fail to write out a trading plan.Many who come to trading have a full time job or have been successful at their own company. Whether it was their company or they work for a large corporation, every business has a plan.
- 00:01:07 - (duration:00:00:12) - This plan does not sit in the head of the CEO. The action of pen to paper was undertaken and everything from goals to how to generate profits is laid out.
- 00:01:19 - (duration:00:00:13) - This helps keep them focused on the proper direction for the company. Actually, the jobs of the employees depend on the company having a clear plan.So why do people think the business of trading is any different?
- 00:01:32 - (duration:00:00:04) - Is it the ease of turning on the computer and placing a trade?
- 00:01:36 - (duration:00:00:05) - Is it because you can do it from any place in the world with WIFI…including the beach?
- 00:01:41 - (duration:00:00:11) - Is it because the initial cash outlay does not have to be huge in order to start making money?Heck, I would think those are the reasons you would WANT a clear direction….a written plan.
- 00:01:52 - (duration:00:00:11) - Maybe there is some deep psychological issue as to why people gloss over a trading plan. I don’t know and in fact I don’t need to know.Neither do you.
- 00:02:03 - (duration:00:00:08) - What you do need to do is to stop acting like a non-professional business owner and get your plan written down.Think it is hard?
- 00:02:11 - (duration:00:00:27) - 1. What constitutes conditions for a possible trade?2. How will you enter?3. Where is your stop going to go?4. What % of your account will you risk to see is this trade will be successful?5. What price will you take action after the trade is entered? Will you exit? Scale out? Trail stop?
- 00:02:38 - (duration:00:00:06) - Five questions to write down. Five questions to answer.Don’t take another trade until you do.