One of the most important things to do in trading is to build yourself a trading plan, it is essential to making a success out of trading. A trading plan is there to protect your capital and mindset which are two major factors in trading.
There are a few things you will need in your trading plan such as:
- Risk management strategy
- Trading system
- Psychology protection
In this article we will cover all 3 of these and give you an idea as to how you can build your very own trading plan.
1.) Risk Management Strategy
Firstly, you need to determine what trading system you will be trading, if it’s a scalping strategy, a day trading strategy, or even a longer term trading strategy. These will influence how much you want to risk per trade. Here are some examples you can look at with each trading system:
- Scalping: 0.5% risk per trade
- Day Trading: 1% – 2% risk per trade
- Longer term: 3% – 5% risk per trade
These are just guidelines you can use when calculating your risk, as you know more about the systems you want to trade you can adjust accordingly.
To make it easier we have a risk calculator which does all of the calculations for you. Available to all of our existing clients, free of charge.
2.) Trading System
You will need a tried and tested trading system that’s going to tell you when to hit the buy or sell button. It also needs to tell you where to put your stop loss and take profit levels.
Luckily, we have 20+ trading systems with hit rates of over 80%. These are also available to our client base, and we trade with these systems every day chasing 4% to 5% of account as a daily target.
3.) Psychology Protection
Something you can use to instil discipline into your trading so you can stick to the systems is a trading diary. Every trade you take can be put into your trading diary to hold yourself accountable to trading a specific system/strategy and not deviating from your plan.
Visit the link below, it will take you to our website where you can download a FREE trading psychology sheet.
Something else that can help strengthen your psychology is joining a community of like-minded traders. Why? Because trading is lonely.
We have a community of traders that trade with us every day over zoom. We trade the same systems and chase the same targets which allows you to clear your head a bit, you will come to find that you will stress less when you are trading.
We build trading plans with our clients which can take all that work away. It also means that if you are a new trader, you wont make any mistakes or be confused when you make yours.
If you feel like you want to see what other benefits we offer our clients then you can register for our free trading webinar, which occurs every Wednesday evening over zoom.
To book a spot visit:
https://www.thesystemstraders.com/free-webinar-wednesday-nights/
I hope you have a fruitful trading month.
Anton
Trader @ The Systems Traders