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- Talitha Taslim
- Posted Articles: 13
- Last Posted: 2017-08-03 08:59:33
Finding the Best Trading Plan for You2016-12-08 12:03:04
The quest for searching a feasible trading plan is not an easy feat. Several elements are factored in, including a person’s financial situation, objectives, and risk appetite. Whether you are embarking on your trading journey or updating your trading game plan, you can ask yourself the following questions to find the most suitable trading plan which suits your needs.
Before we begin this discussion, it pays to know the reason for asking these questions. Recognize that these enquiries focus on the person implementing this plan, not only the strategy itself. If the trader cannot stick to his plan, even if it is well-written, the plan itself becomes useless.
Now, here are the questions to ask yourself.
Is the plan good enough to help me achieve all my financial goals?
Trading outcome should be something measurable and workable. This is not as simple as dreaming to become a billionaire. It is important to assimilate the main objective for forming a trading plan, as well as if it is reasonable and workable. One should figure out whether the plan can produce the desired result. Aside from that, the trading plan and result must be adjusted to make short- and long-term goals workable. These two types of goals should go hand-in-hand, not against each other.
Does the plan reflect me as a trader?
This is a tricky question to ask. It has never been easy to gauge if the plan really belongs to you. If a person cannot stare at his trading screen for half an hour at the very least, granted the trading plan is good, that person cannot likely become successful. Also, if a trader cannot sleep peacefully because he keeps thinking about his open positions, chances are the plan will go against that person. In other words, if a trading plan is easy enough to be executed and it fits your personality and passion, the plan is for you. Otherwise, look for another one.
What are the pros and cons of my trading plan?
At this rate, move away from fantasy and into reality. Every trader loses money, big or small. Even Warren Buffett. All plans have corresponding gains and risks. Therefore, a trader has to pinpoint all the potential wins and losses by reviewing the plan. Take into account the possible consequences as well. List down all your observations and determine if your trading plan is applicable and won’t hamper other aspects of your life.