Simply 1 of this article I described the unwillingness of beginning e-mini dealers to formulate and write a comprehensive e-mini trading plan. Like lots of things in trading, I suppose that activities besides actual e-mini trading are perceived as spurious and unnecessary. In part 2 of this article I hope to convince you that writing a thorough trading plan (and following it) is one of the essential activities necessary for growth in your career. fusionex
Styles of trading are unique from person to person. Just like many things in life, no two individuals are going to approach it in the exact same manner. All of us all tend to see and interpret charts in several ways, and how you abstract information from a chart will influence your analysis of potentially profitable trades.
It is vital to get there at similar conclusions about the potential success of a trade. As a mentor, I have a specific guidelines and standards define a position that is likely to do well. How the beginning e-mini trader’s perception of data variables causes my specific guidelines and standards is how I define an investors “style. ” If My spouse and i have learned anything in a lifetime of trading it is this: no 2 individuals see and interpret chart variables in exactly the same way. I think it is important to note that distinctions in styles of perception do not preclude 2 traders from getting the same conclusion. The tool i use to quantify a beginning dealers style with the goal of coming to the proper analysis of deals is a written trading plan.
What sort of things could be a good trading plan include?
? First and foremost, I believe it is important for an individual to define, in specific terms, why they can be trading.
? A beginning investor must have quantifiable goals; immediate, intermediate term, and long term. These goals should have specific objectives that are realistic and attainable.
? What markets are you planning to trade? Why?
? What entry criterions are necessary to a trade? I actually prefer of those criterion to be specific and quantifiable.
? How will you deal with risk? Some specific strategy for deciding profit focuses on and stoploss levels should be discussed. Also, position sizing must be quantified and the methodology for the number of deals you will trade should be specific. How will you exit trades? When ever? How about risk/reward rates in your trading plan?
? Money management is one of the main aspects of e-mini trading. What is your money management plan and how did you determine the components of your money management plan?