How many times have you let a loss run and cut a profit short because it was the comfortable thing to do? The template is broken down into eleven units.

The objective of the exercise is to end up with a plan that is tailor made to suit your personality, ability and resources. Do not be tempted to skip any sections and be sure to work through them in the order that they appear. The order is specific for reasons that should become clear in due course. Think of the eleven units as links in a chain or as individual players in a football team; each one is as important as the other.

Although the template is designed to be as simple as possible, be sure to give careful consideration to all your answers. For example, the first unit poses the question, why do you want to be a trader? It is not personal to you and, therefore, it is not helpful to your plan.

You might enjoy a cappuccino from time to time, but chances are that you would not dream of taking up a Starbucks franchise - so why become a trader? If so, you may have a need for excitement. Ordinarily, such a desire is an admirable one but, in the markets, it could easily lead to catastrophe if allowed to go unchecked. Perhaps you have heard stories about traders making tens of thousands in a single day?

Crushing disappointment is often the reward for unbridled greed. Pie in the sky fantasies about trading via a laptop while aboard a luxury yacht, sipping champagne in the Bahamas, are great fun, but they are hardly grounded in reality. Such fantasies may help to motivate you to study the markets, but the emotions that accompany them may not help you when it comes to trading the markets. Just as the trader with a lust for excitement is doomed to fail, the fate of a trader motivated by greed is almost certain to lead to disaster.

Think very carefully about these questions and be brutally honest with yourself. Do not pretend to be someone you are not because you are embarrassed to commit pen to paper and admit that you are a thrill seeker chasing the Holy Grail of easy money. In answering the question about why you want to be a trader, you will uncover the real motivations, fears and desires that fuel your ambition. Some of these will be helpful whilst trading, others not. How you allow them to impact your trading is what this document is, to a large extent, all about.

To ensure that the impact is a profitable one, you must start by examining your real reasons for trading and, hopefully, learn more about yourself in the process.

Then there is a basis for an answer in small Arial italic type, like this to provide further clarification. The latter is intended as a guide only and is not meant to constrain your thoughts and ideas in any way. There is no room for ambiguity in your plan; so avoid vague, fuzzy statements.

Also, where possible, always define and qualify your statements. This usually means posing the questions - what, when, where, why or how. For example, suppose you swing trade the Dow Jones 30 Index. Why the DOW and not the FTSE ?

Because you want to trade in the evenings, after work? Okay, fair play. How will you ensure your success?

Aha, you will start by writing a trading plan? When will you write it? You get the general idea. Now, let us begin. Know Yourself, Know Your Purpose 5. Many inexperienced traders are unprepared for the violent assault on their thoughts and emotions at the start of their careers.

They soon find their heads spinning with euphoria when winning greed and the pits of their stomachs knotted with anxiety when losing fear. Contrast this with many professional traders who, it is said, achieve a sort of trading nirvana, whereby their thoughts and emotions blend into a sea of calm regardless of whether they are winning or losing.

Their heads do not spin and their stomachs do not churn — ever. For you to achieve this exalted state, you will need to know yourself and how you will react to both winning and losing positions. Once armed with this information, your trading plan can incorporate some of the positive aspects of your psychological make-up and filter out some of its negative aspects.

What is your purpose - what does success as a trader mean to you? Decide what it is that you want to achieve and then ask why and how trading is going to provide it.

How sad it would be if, after a year or more and hundreds if not thousands of pounds later, you realised that trading was not for you after all and that the ladder to success was leaning up against the wrong wall.

Okay, here goes — your very own trading plan starts now. Question your true motivations. Examine whether your talents would be better suited to another business like the Starbucks franchise mentioned earlier. Are you certain that trading is the right business for you? If you believe that the markets exist for the sole purpose of showering you in vast quantities of easy money — then think again!

Beware: it is NOT the easy option! I want to be a trader because. My primary objective in wanting to be a trader is to. My secondary objective is to. spend more time with my family and enjoy the freedom of being able to trade from anywhere in the world. These objectives are important to me because. they provide purpose and direction to my life and enable me to lead a more balanced one. I believe I can achieve my objectives because. my name is Larry Williams - say no more!

Are you a discretionary trader or a mechanical one? Do you propose to trade in the long-term i. months , medium-term i. weeks or short-term i. days or, even, intra- day? The choice of position trader, swing trader or day trader will, to a large extent, be determined by the amount of time you are able to devote to your business.

Generally speaking, day traders remain glued to their monitors throughout the duration of every trade, whilst position traders may devote as little as one hour a week to the markets. Define your trading style and examine your beliefs about the markets. I am a discretionary trader and my style is very. aggressive - which makes me suited to scalping intraday or, alternatively, conservative — which makes me suited to swing trading end of day E.

I understand that I cannot predict the future and I accept that I cannot control the markets. However I can control myself, which I will do by. adhering strictly to my trading plan that is detailed, specific, tested and profitable. List each of your trading strengths and weaknesses and then specify how you will maximise the benefit of the former and minimize the damage caused by the latter.

This is often easier to do for other people than it is to do for yourself. Your background may provide some clues. Suppose you are an ex-fighter pilot who is used to working in a highly disciplined environment and adhering to a set of very strict procedures. Potential strength. However, the flip side of the coin is that you may also have a need for fun, or an addiction to adrenalin pumping, nail biting excitement or, even, a subconscious desire to experience fear.

Potential weakness. If you are struggling to answer this question, try paper trading for a while and examine each trade, noting what you did right and what you did wrong. Do this until a pattern starts to emerge which should reveal your strengths and weaknesses to you. My primary strength is. allowing my profits to run and closing trades in accordance with my exit strategy. My secondary strength is. My primary weakness is.

wanting to recoup a loss quickly which, almost inevitably, results in increased losses. The following aspect of my trading plan will help to control this weakness and prevent losses from spiralling out of control.

I have a pre-defined daily stop. If it is hit, I stop trading for the day. My secondary weakness is. Your mindset is the key obstacle that lies between you and success in the markets. Have you slept well; are you fit, healthy and mentally alert? Are you calm and relaxed or are you tired and distracted by other events in your life? I am rested, relaxed and not distracted by work or family etc.

I will be guided by my trading plan and I will adhere to it rigidly. It will help to prevent me from making trades that are poorly conceived and executed; i. I will not trade on days when. I am feeling off colour, hung over, particularly tired or when I am mentally distracted by other events in my life.

There are numerous reasons for becoming a trader; making money is the one reason that unites us all. Your targets are not idle fantasies, they must be based upon your back and forward testing results.

This is expanded upon in sections My financial targets are. Trading Goals 6. Try to define your goals in terms of your development as a trader, as opposed to purely financial goals. If you focus on becoming a proficient trader, the financial rewards are sure to follow just as night follows day. Then decide how you will achieve these goals and how you will reward yourself once you do. The rewards should reflect the scale of the achievement as well as being specific and meaningful to you.

For example, the reward of a night out should name both the venue and the people you intend to take with you. This is the big picture. Think in terms of the skills and knowledge that you want to acquire between now and this time next year. My annual trading goal is to.

At the moment, this comprises three separate elements, namely: 1. I model the best trading practices, including having a written, clearly laid out trading plan. My strategies are well developed, tested and monitored comprehensively to ensure that they remain tradable, market sensitive and profitable. I expect to achieve these goals because.

When I achieve my goal, my reward will be. Now define your monthly trading goals. Again, avoid financial targets as much as possible. How will you achieve these goals and how will you reward yourself when you do? My monthly trading goal is to. achieve consistent profitability every month, with a Success ratio of or more and a Sharpe ratio of 1.

When I achieve this, my rewards will be. Time to get out the magnifying glass and zoom in on the details. Now define your weekly trading goals. How will you achieve them and how will you reward yourself when you do? My weekly trading goal is to. trade every day of the week in accordance with my trading plan. This will entail taking my stops instantly; sticking to my risk and money management strategies; following my exit criteria and devoting most of my time to searching for new trades and choosing only the very best setups.

When I achieve this goal I will pat myself on the back by. Finally, put away the magnifying glass and get out the microscope.

On a day-to-day basis, what are you trying to achieve? How will you measure your progress and how will your hard work be rewarded? My daily trading goal is to. trade according to my plan. Today I will stick to my plan because it is detailed, specific, tested and profitable. I am confident that I have the self discipline to adhere to it which, in turn, will ensure that my weekly, monthly and annual goals are met. Assuming that I stick to my plan, I will pat myself on the back by. Nothing blended - single malt, obviously!

Decide upon the market you wish to trade; the instrument s that are available within that market and the reasons for your choice. As a general rule of thumb, professional traders tend to restrict their focus to a limited number of markets and instruments. By contrast, novice traders tend to trade index futures one day, currency pairs the next and exotic sounding commodities like pork bellies the day after that, etc!

stocks in the evening after work because good opportunities exist in the pm session. They also provide excellent liquidity, volatility, tight spreads, fast fills, low commissions and no stamp duty. Will you confine yourself to a basket of stocks or will you trade anything and everything on the XYZ exchange? If you trade futures, how many different markets will you trade, and why?

If you are a forex trader, how many currency pairs will you trade, and why? not exceed X and be determined according to their liquidity, i. a minimum daily volume of 2 million shares, and according to their volatility, i. Hopefully, you have decided what sort of trader you are or want to become, i. an intraday, swing or position trader. Now you need to focus in on your timeframes within the category of your choice.

Be very clear in your own mind about the number of timeframes you use and why you use them. For example, a day trader may use a 1 minute timeframe to enter a trade, a 5 minute timeframe to exit a trade and a 15 minute timeframe to help determine the trend throughout the duration of the trade.

As a swing trader, I will use. daily charts to determine the trend; 10 minute charts to enter and exit positions and 60 minute charts to monitor my open positions. Tools of the Trade 8. Whichever vehicle you use to trade; Shares, Spread Betting, Contracts for Difference C. understand fully the pros and cons associated with your choice. This applies to Spread Betting especially.

Without question, it is a very popular financial product that is ideal for novice traders, but it does have its drawbacks. For example, it is almost impossible to day trade profitably using this trading vehicle.

My choice of financial vehicle is. Spread Betting because I can open an account with just £, trade just 1p per point and profits are currently tax free.

However, I understand the limitations of this product and that it is best suited to swing trading. Both players would perform well with any old kit, but choosing these primary tools with great care helps them to achieve consistent sporting excellence. The instruments that you wish to trade.

If, for example, you wish to trade U. The vehicle or financial product you use to trade the instruments of your choice. Spread betting, C. The size of your account. If you have only limited capital with which to fund your trading, you are not going to be able to open a Patten Day trader P. account with a direct access broker. Furthermore, the choice of brokers offering C. Ds is likely to be limited. Spread Betting may be your only viable option and is where many new traders start. The platform you use to trade.

This is usually the one supplied by the broker. It must offer the features that you require and you must be comfortable using it. The level of support and customer service offered by the broker. Check out the reviews on T2W to see how the broker you propose to use fairs.

Your level of experience. Choose instrument s and a broker that you can cut your teeth on and minimise the risk of losing your shirt! My choice of broker is. com because they offer the universe of stocks that I require with competitive spreads; they have won numerous industry awards for their lightning fast trading platform and their customer service is second to none.

If your trading decisions are based upon technical analysis T. My choice of data feed is. com because they provide data for the instruments I want to trade, whilst providing the option to upgrade, giving me access to other exchanges with real time data in the event that my trading style and strategies change.

It is essential to undergo a daily pre-market routine to ensure that you are prepared fully for the trading day ahead. My daily pre-market routine comprises five key areas, namely.

To review any open positions and update targets and stops. To plan the day ahead, hour by hour. To make an initial selection of possible instruments to trade. Did you adhere to your plan and, if not, what effect does this have on your trading activity today?

In other words, your ability or otherwise to stick to your trading plan yesterday, should determine your trading activity today. analysed and logged and that my trading journal is up to date. Additionally, I will check to ensure that I adhered to all aspects of my trading plan. In the event that I fail to adhere to my trading plan. However, if you are a swing or position trader, you may well have some open positions. If I have positions open in the market. I will update targets and stop losses and confirm that the reasons for entering the trade in the first place are still valid.

Are there any major news stories impacting the markets? This website is free for you to use but we may receive a commission from the companies we feature on this site. We Introduce people to the world of currency trading. and provide educational content to help them learn how to become profitable traders.

we're also a community of traders that support each other on our daily trading journey. com is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

Finixio Ltd, Tower 42, 25 Old Broad Street, London EC2N 1HN [email protected]. Search this website. It provides you with the ability to connect your forex trading account to the platform and utilize their advanced trading analysis software to analyze your trades and develop a more meaningful understanding of your trading habits.

Using MyFxbook provides traders of every skill level with several advantages. Beyond simply allowing traders to organize and track all of their trading systems in one place, MyFxbook will also allow for the opportunity to follow more experienced traders in the community and give more inexperienced traders a chance to learn from their strategies and techniques.

If you are looking for a trading journal and are not in a position to invest in purchasing one, then MyFxbook is a fantastic resource to have at your disposal. While it is only available for traders looking to trade in the forex markets, it has the functionality to connect directly with your MetaTrader4 account and provide you with some extremely valuable data, including your average daily profits, the number of shorts won, and the number of longs won.

Those interested in trading forex and taking advantage of this platform can signup for free here. The signup process is straightforward and should not take longer than several minutes. While they are not always utilized, trading journals are handy tools that traders can take advantage of to identify their overall performance and areas for improvement. They can be used to do anything from tracking statistics to preparing for the dreaded tax season. At the beginning of this post, we noted that every tradesperson needs their toolbox and that a day trader is no exception.

Unfortunately, there are no substitutes for discipline, focus, and hard work. No trading system or piece of software, however sophisticated, can replace these attributes. If you want to succeed as a day trader, then you will need to take the time to develop your skills and improve your performance through practice and hard work. Dylan is both a trained lawyer and an experienced financial content writer from the United Kingdom. He specializes in writing about the US markets and has developed a keen interest in cryptocurrencies and decentralized finance.

Table of Contents. Dylan Soiza.

edu no longer supports Internet Explorer. To browse Academia. edu and the wider internet faster and more securely, please take a few seconds to upgrade your browser. E x i t S t r a t e g y every action should be spelled out, so that in the heat of the moment you do not have to make any decisions, you just follow what the trading plan stipulates.

Jose Antonio Muñoz. Log in with Facebook Log in with Google. Remember me on this computer. Enter the email address you signed up with and we'll email you a reset link. Need an account? Click here to sign up. Download Free PDF. TRADING PLAN TEMPLATE CONTENTS. Teodor Kiryakov. Continue Reading Download Free PDF. Related Papers. How to Make a Living Trading Foreign Exchange.

Download Free PDF View PDF. TRADING PLAN TEMPLATE C o p y r i g h t © Tim Wilcox Disclaimer All reasonable steps and due diligence have been taken in preparing this document. However, it may contain ideas that are not appropriate to you or your style of trading, so do your own research and draw your own conclusions.

By itself, this document will not enhance your trading performance, nor will it prevent you from incurring losses. Any losses that are incurred are the sole responsibility of each trader. TRADING PLAN TEMPLATE ©TIM WILCOX CONTENTS Introduction Page 3 TRADING PLAN OVERVIEW 1. What is a Trading Plan? Page 4 2. Who Needs a Trading Plan? Page 4 3. What Will a Trading Plan Do? Page 5 4.

Before You Start. Page 6 TRADING PLAN TEMPLATE 5. Know Yourself, Know Your Purpose Page 9 6. Trading Goals Page 11 7. Tools of the Trade Page 13 9. Before the Market Opens. Page 14 Exit Strategy Page 21 After the Market Closes. Page 24 Page 25 Golden Trading Rules Page 26 TRADING PLAN EXAMPLES Roll Up, Roll Up. com T2W. The purpose of the thread was to produce a template by which all traders - regardless of experience, instruments traded, timeframes and brokers etc. This document is the result of that thread.

It comprises two main sections with a third section that in time will, hopefully, contain examples of real plans created using the template. T R A D I N G P L A N O V E R V I E W The Trading Plan Overview addresses fundamental questions regarding the subject, starting with a simple definition. It then moves on to discuss why traders need a plan at all and, once they have created one, what it will do for them.

Those traders who are already convinced of the merits of having a plan, please feel free to skip this section! It comprises ten key units, with a series of questions in each one: about 50 in total. The hope is that any trader can use the template to create their very own bespoke trading plan. Make no mistake, it will take time and effort to complete. But, having done so, you will at the very least, gain a greater insight into the kind of trader you are now and enable you to focus on the kind of trader you want to become.

Explanatory notes and an outline for a possible answer accompany all the questions. For ease of navigation, there is a reference number at the start of each paragraph. If you get stuck at any point, help is at hand from fellow T2W members. In order that other traders may benefit from your amendments, please post your ideas on the thread above. T R A D I N G P L A N E X A M P L E S Currently, this section contains no trading plan examples.

In an ideal world, it would house at least three complete trading plans: one for index futures traders, one for forex traders and one for stocks traders.

The icing on the cake would be if they also covered the three main timeframes: day trader, swing trader and position trader. In itself, a plan is not an edge but, over time, the trader with a plan will fair a lot better than the trader without one.

Many amateur traders do not have any sort of plan to trade by, and enter the markets with scant regard to their risk and profit objectives. Suffice to say, comprehensive risk and money management strategies lie at the heart of all good trading plans. They can evaluate their progress continually, day-by-day, in a way that is objective and comprehensive.

This enables them to trade without emotion and with minimal stress. The trader without a plan is not able to do this and their trading tends to rely upon gut feeling, hunches and tips etc. Trading for them is a nail biting, emotional roller coaster ride of stress that, inevitably, results in financial loss. However, a good plan that is adhered to strictly will help to minimise losses and enable you to stay in the game a lot longer than traders who do not have a plan.

This is why a plan is essential. It is a list of strategic responses to events beyond your control. As stated above, the former is a complete set of rules that governs every aspect of your trading life. It goes into great detail and may, for example, stipulate the amount of time devoted to reading threads on T2W!

However, these are merely elements of an overall trading plan and possibly not even the most important ones. It is perfectly feasible, desirable even, to include two or more trading strategies i. entry and exit criteria within an overall trading plan.

If you have achieved this, then this document may not tell you anything you do not already know. It is quite literally the route that will take you from where you are now to where you want to be which, for most traders, is consistent profitability.

In this analogy, consistent profitability is the destination. Similarly, to embark on trading without a clear idea of where you are going, and how you are going to get there, will almost certainly result in increased stress, sleepless nights and financial loss - or all three.

The question you must ask yourself is this: if you would not dream of driving from the north of Scotland to the most southerly tip of England without a detailed roadmap, why on earth have you not got a detailed and clearly laid out trading plan?

It will limit your opportunity to make bad trades and it will prevent many psychological issues from taking root. It will help you to achieve these things because wherever you are on your trading journey, it will not only act as a roadmap, but also locate your position as well. Most importantly, if your trading is going badly, you will know it is down to one of only two possibilities: either something in the plan is not working or you are not adhering to the plan.

If the plan is a good one and it is back tested and paper traded, or forward tested with a very small amount of money then the fault is likely to be found in the latter of the two options. But, what if you are losing money whilst trading without a plan? It is virtually impossible to distinguish what you are doing right from what you are doing wrong. You have no way to evaluate your results, therefore the likelihood of being able to diagnose the fault and correct it is small and could take forever.

A trading plan is your personal GPS device to locate your position and, if you have made a wrong turn, it provides the means to identify where you went wrong and how to get back on track. You are able to evaluate continually your results and, more importantly - your discipline - in a manner that is objective and comprehensive.

This is extremely difficult to do if you do not have a plan. Emotional issues will become very powerful when real money is on the line and, as likely as not, force you into making irrational decisions. A plan will instil a large measure of discipline into your trading. How many times have you let a loss run and cut a profit short because it was the comfortable thing to do?

The template is broken down into eleven units. The objective of the exercise is to end up with a plan that is tailor made to suit your personality, ability and resources. Do not be tempted to skip any sections and be sure to work through them in the order that they appear. The order is specific for reasons that should become clear in due course. Think of the eleven units as links in a chain or as individual players in a football team; each one is as important as the other.

Although the template is designed to be as simple as possible, be sure to give careful consideration to all your answers. For example, the first unit poses the question, why do you want to be a trader?

After the Market Closes. The platform you use to trade. Instead of journalling anything subjective, it tracks and analyses your trading results allowing traders to take an objective look at where their edge may lie. My annual trading goal is to. You also have the option to opt-out of these cookies. Examine whether your talents would be better suited to another business like the Starbucks franchise mentioned earlier.

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