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A trading plan is your roadmap for what you are going to do in the markets.It’s something that you have to create and is not optional.This is a ratio of your profitable trades divided by your losing trades.
Companies report on a quarterly basis to the street, which fundamental analysts then feverishly work through the data to assess a company’s future growth potential.
Well, how long should you wait to evaluate your trading performance…yearly, monthly, daily? Base your evaluation period on the number of trades placed and not by the amount of time passed. Trading is one of the few areas in this realm, where the space-time continuum are of no relevance.
You will have to first ask yourself the question, what is my time horizon for this trade?
Day traders will want to focus on stocks in the news, while long-term traders will want to focus on stocks that are developing new business models that show the potential for multi-year growth.
Similar to the times of day you will trade; keep your trading edge down to one or two setups when starting out.
The more strategies you hope to master, the more difficult it will become to consistently make money in the market.This provides you with the greatest opportunity for locating stocks that are trending hard with high liquidity.Within Tradingsim, our market movers component provides you the top list of gainers and losers in real-time.This way you don’t have to navigate through hundreds of charts manually.Stop losses are not a negative thing; they are what keep you in business over the long haul My stop loss is once the position goes against me by 2%.Whatever your trading style, make sure you identify the plays that have the highest odds of profitability.For day traders, you will want to focus on the market movers.This should go beyond the standard trading setup and needs to touch on items like money management, trading discipline and your overall purpose for trading.In most lines of business, time is the main driver for evaluating performance.The 2% threshold is based on the volatility of the stocks I trade and may not be suitable for your trading style.The point here is just to make sure you have a stop loss.