Picture this – You are attending an important conference.
You are sitting in the middle of the auditorium among hundreds of fellow attendees awaiting the keynote speech when the Master of Ceremonies comes to the podium and announces,
“Will the person in Row 34, Seat 13 please come to the podium and give the keynote speech?”
You look at the little plaque on the front of your seat and you realize that you are sitting in Row 34, Seat 13.
How would you feel about getting up in front of all those people and giving a speech that you had not planned to make?
How good a job are you likely to do without a well-rehearsed outline of your speech to guide you?
Can you feel the unease and the fear from having to give the speech without preparation or plan?
I know this all sounds ridiculous because no important conference would have a keynote speaker who was not fully prepared. The result would be disastrous.
This is the way most traders start their trading day – without a plan. No wonder so many traders are afraid of the market. For the unprepared, the market can be a fearsome adversary.
However, like the speaker who is well-prepared, a trader with a detailed, written trading plan will be ahead of the 90% of other traders who start the day with no written plan at all.
You do not even need a perfect trading plan. You just need to design a workable trading plan that makes sense to you and includes:
- the setups you will take;
- defines your risk per trade, per day and per month;
- states your goals;
- explains how you will keep records of your trading; and
- lists the steps you will take should you have an equipment, software or Internet failure.
In my Electronic Trader Mentoring Program, the first priority for a new mentoring trader and I is to design a clear, written trading plan. This unique plan incorporates the best of what the trader has already found effective along with a series of setups and strategies that I have successfully used with dozens of other traders.
Once we have developed a written trading plan, we can be confident in approaching the market in a structured, rational way.
One last thing:
You should be happy for all the other traders who trade without a plan.
After all, they are the ones who are needlessly leaving money in the market for us better-prepared traders to earn.
Wishing you success in your trading, Jeff
Copyright © 2009 by Jeff Quinto, all rights reserved
