What would you say belongs in a solid trading plan?

Discussion in 'Trading' started by easymon1, Feb 10, 2020.

  1. Will90

    Will90

    I found some really good tips in here. Thanks!
     
    #41     May 15, 2020

  2. Simplicity
     
    #42     May 15, 2020
    persistence likes this.
  3. maxinger

    maxinger

    A solid trading plan takes care of

    various market conditions,
    various market environment,
    various market behaviour / personality.
     
    #43     Jun 25, 2020
  4. KCalhoun

    KCalhoun

    Absolutely -- it's all about position management. In my lessons learned thread a lot of traders disagreed with my assertion that EXITS are much more important than entries.

    It's how you set stops, re-entries and where you exit your trades that matters. Obsessing over specific entries is not nearly as important.

    Scanning to find charts worth trading is essential, eg wide range clean patterns.
     
    Last edited: Jun 25, 2020
    #44     Jun 25, 2020
    murray t turtle likes this.
  5. easymon1

    easymon1

    trading plan investopedia.jpg
     
    #45     Jun 27, 2020
  6. deaddog

    deaddog

    Re your exit rule;
    I don't set a profit target. I look for a change in the price action.
    Why close a position that is moving in your direction? Let the winners run!!
     
    #46     Jun 27, 2020
    murray t turtle likes this.
  7. easymon1

    easymon1

    i appreciate the compliment, but those three items are from an article in investopedia. i like that ol' Matt put Exits before Entries. Kinda one of those Begin with the End in mind peices of advice.

    But yeah, nothing wrong with runners.
     
    Last edited: Jun 27, 2020
    #47     Jun 27, 2020
  8. easymon1

    easymon1

    The 2% Position Risk Rule: Facts and Fiction
    https://www.priceactionlab.com/Blog/2019/06/position-risk-rule/

    Conclusion
    The 2% rule, or any x% rule of this sort, applies to frequent trading at low cost
    where the effect of a reduction in expectation due to position sizing is
    counterbalanced by an increase in frequency of trades.

    The 2% (or X%) rule can be used with

    • Medium frequency trading (scalping, intraday, short-term)
    • Strategies with well-defined stop-loss levels
    • Multiple open positions in different markets (portfolio heat control)
    The 2% (or X%) rule cannot be used with

    • Most mean-reversion strategies
    • Medium to longer-term trend-following
    • Strategies that do not use stop-loss
    Alternative schemes for controlling risk when the rule does not apply must be used as mentioned above including but not limited to varying the strategy
    allocation accordingly.
     
    #48     Mar 13, 2021
    murray t turtle likes this.
  9. Shmo007

    Shmo007

    .... assuming you have good trading ideas, I'd say:

    1. Trade management (when the trade goes in you favour).
    2. Risk management (when the trade does not go the way you envisioned).
    3. Discipline to follow your set-ups (i.e. don't chase, don't trade via emotions).
     
    #49     Mar 13, 2021
  10. deaddog

    deaddog

    If your trading plan can answer the following questions you have a solid trading plan.

    Where do I buy?
    What do I buy?
    When do I buy?
    How much do I buy?
    When do I sell?

    The devil is in the details..;)
     
    #50     Mar 13, 2021
    murray t turtle likes this.