*** My Trading Plan ***

I suspect what I am going to say may not really register with you, and some people will disagree. But I think your plan may be more of a distraction than a help

Only 1 thing really affects your longterm trading success. It is not:
-- Psychology
-- Money Management
-- Picking the right instrument
-- Technical/Fundamental Analysis
-- Having seats on an exchange
-- Mentors
-- Recommended books
-- etc.

This is how I would rewrite your business plan:

I WILL ONLY TRADE THE MARKETS WHEN I HAVE A PROVEN, TESTED METHOD THAT OUTPERFORMS.

Many people trade, but few of them do it very profitably over extended periods of time. If you don't have a REAL market outperform over an extended period of time, there is nothing under the Sun that will make you profitable.

The concept of money management making random entries/exits profitable is a figment of the imagination.

 

I'm not making random entries. I disagree with you. It may be a distraction to you, but let me tell you, this seems to be working for me. I'm having the best week as a trader so far in my trading career. Yea, it's only been a week, so only time will tell if what I'm doing is working.

 

Nice trade plan sir. More traders want to do this. Thats how the money is made in postion sizing, any old fool can trade 1 lots all day long..I wish you well in your trading.

 

A "proven tested method that outperforms" involves money management therefore....you're wrong!

 

I wish you the best of luck but I think you're very under-prepared for the realities of this game.

I'd like to see your attitude when you have a bad run and you start questioning your 'strategy'. Just as an example, when I was trading prop, the wonderboy of the first 2 months I was there was a crazy horse guy who traded FX with a 'plan' but really a buinch of discretionary indicators that were used in a non-uniform way.

From a positive position of above $25k within 2months, he was out the door at $40k down within 3 months.

Good luck, but please don't be over confident and be prepared for the fact that you don't have it sussed, but you can learn quick enough to make it work if you pay attention. Figure out what's behind the winners and losers because it isn't a f**king moving average or a fibonacci level bounce every time. Losers get addicted to remembering the 2 times out of 10 that these things work.

 

looks like you have it all figured out cept experience. my dad use to say figure out a way to make a dollar and do it a million times and you'll have yourself a million dollars.

now you need to place a trade and be prepared to face reality. mb

 

I didn’t say anything about random entries in relation to your trading. I said that the core component is a method that outperforms. If you think a week means anything, then you will soon find out why over 90% of leveraged traders lose their trading capital within the first year or so.

If you listen instead to experienced traders instead of argue about your unproven prowess, you might actually last. Your trading plan will not get you any closer to success if your underlying method does not outperform. Study the concept of “Risk of Ruin” and consider the story that the best way to make a small fortune in the futures market is to start with a large fortune.

Pictures of cars, plans of reaching, and starting a hedge fund show me that you are years away from success, and very close to blowing out your account. You can’t read things like “Think and grow rich” or listen to motivational tapes to succeed. The market is not your path to the stars; it is a den of lions, followed by a pool of piranhas, after a tank filled with great whites and killer whales, shortly followed by a den of bomb-toting fanatics who wish to martyr themselves at your expense. And strapped to your body, is 100 pounds of odorific meat and fish and signs denigrating the beliefs of the fanatics.

But you seem to prefer defending your own unproven skills rather than listening, so I won’t bother you anymore. See you in bankruptcy court.

Completely incorrect. Money management is a way to MANAGE the outperformance. A monkey can just use leverage and look like they are outperforming. Until they crash into something like Feb. 27th and blow out their account. Outperformance means that during a period of time, a trader can outperform do better than buy and hold. A true measure of outperformance, is a system whose longs AND shorts are generally profitable, regardless of current market structure. Most other traders usually live in a fantasy world, riding a current trend and patting themselves on the back. Until the big movement against them...

 

Sorry I didn't get here earlier. You don't want to hear this, but 120,000 is no where near enought to trade 100 lots. No matter what your clearing firm might say. I know people with 10x that that won't directionaly scalp e-minis with 100 lots.

While steady progress is good, teh market will always be around. take your time. Ensure your success.

 

Started the week out fresh and towards the end of the week broke a lot of my written rules. On Friday, I broke 4 rules, give or take. Hit the 50 dollar stop loss limit and called it a day. I deserve every loss I had on Friday. I didn’t obey my rules and I got clobbered for it. I felt like trading after the fifty dollar loss but I have to obey this stop loss before I overtrade. On top of that, I broke so many of my rules today that even if I didn’t hit my fifty dollar loss limit, I deserve to stop trading for the day. I’ll take this time to go over my trading plan and add some new rules (such as how many rules I break before I call it a day, etc.) to my trading plan. April is a new month. I didn’t copy the executions on Monday. For April, I’m going to copy every single execution and write the reason why I entered each trade. I’m going to write the profit and loss I made each day as well. The daily balances in my firm come the next day so I’ll post the net results I made for the week on Saturday. This has been my best week as a trader; although it was a losing week. I didn’t lose as much as I did the previous weeks so I consider it a moral win. More updates to follow.

 

I'm sorry but the money management plan and trading plan are the biggest part of my overall strategy. I just started implementing a money management plan and trading plan recently and it's working. Entering and exiting a specific position with a specific plan is needed of course, however, without having a sound money management plan no matter how highly probable the setup is, you're doomed to failure.