Seeking Advice on Developing a Trading Strategy Plan

Beginner Questions
1

Hello everyone,

I’ve tried to create my trading strategy plan but still find it hard to answer these two questions:

  1. What should I include in my trading plan, and how detailed should it be? How can I make sure I follow it?

  2. How do you decide how much to risk on each trade? Are there any simple rules or tools to help with this?

Thank you for your help!

2

Hi @jomina, before you can start thinking big money, you need to horn your skill.

Your trading plan must be based on your knowledge and experience. Without them, you need to learn first, don’t think of profit first. The steps will be

  1. You need to know your strategy. In a strategy you need to know what trigger to open and close position. There are many strategies out there, pick which one fit you better.
  2. You need to know how your strategy work, does it work to all market condition of only be used in certain condition / trend.

Once you are able to describe above , you need to back / forward test your startegy. Find its performance or statistics. From here you can design a good money & risk for the strategy. If you have problem with them, just show your trading stats here, we can give you many options and feedbacks to improve your trading experience. :saluting_face:

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3

Not worth worrying about - just take a well-known, well-used, well-recommended, well-explained, simple one, see what it explains, and copy its headings (as thousands of people have done).

There’s a really great one right here and it’s free: no marketing, nothing to “opt in to,” nothing for sale, no contact details needed. :slight_smile:

That’s harder.

The best approach is to read either “Systematic Trading & Profitability” by Michael Harris or the second half of “Trade Your Way to Financial Freedom” by Van Tharp. There are free PDF versions of each available on the web, if you use Google. Both have enormous other benefits too, in addition to correctly answering your question above. :wink:

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4

Hi Jomina,
I took the time out to read the plan linked by @Heteroskedasticity. I have a similar plan created in 2019 and modified many times since. I have ignored stock trading almost all of my life since I was 23 years old. But I wish to add stock trading (long term) to my current pursuits next year. Instead of creating yet another 90+ page document, I may well start with the template provided. If you have no plan template to start with, the narrative in the link says all I would wish to say (and more) on the subject matter of your question.

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5

You should try to select such a trading strategy that gives you a better entry and exit point and better risk management depends on various factors so try to adjust your risk with the proportion of trading capital.

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6

Thank you very much for your help

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7

I really want to develop my skills in trading, you’re totally correct, this will help me-Thank you :blush:

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8

Thank you, much appreciated :blush: