Define A Disciplined Trading Plan
There is an alluring charisma within the markets that entices people to the trading lifestyle.
Many want to fire their boss and escape the constraints of a J-O-B. The longing for freedom to do as they please, when they please, and make money in the process can’t be repressed.
The reality of the trading lifestyle often hits these anguished souls with such force that they slink back to their old worlds in the workforce.
Trading, like anything that has potential for great freedom and monetary success, IS a lifestyle. This lifestyle involves a learning curve and definitive risk vs. reward considerations.
Fundamental to developing the trading lifestyle is formulating a plan.
Your plan defines your trading future.
The irony of trading is that it attracts people who hate structure and long for freedom.
Yet, without strict discipline a consistent income from trading is NOT possible. With discipline comes freedom.
A disciplined trading plan helps you:
- Avoid losing your total account value
- Keep from repeating the same mistakes from losing trades
- Know what trades have been working in your account to continue the “rinse and repeat” mantra
Without a defined plan it is easier for undisciplined emotions to flow into your trading and you end up losing money. (Watch for more on a Trading Plan tomorrow…)