Why have a business plan?
The first thing is we have a business plan to keep us on the right track like a road map and if we don’t have a road map how do we know where to go?
Second, having an up-to-date business plan and using it consistently gives us the opportunity to keep track of our business results so we can review our operations and identify our weaknesses and strengths so we can learn from the past.
Third, trade is a business, not a hobby (remember that a hobby costs money, business does money).
Every successful business has a business plan and a trader’s business plan is his Trading Plan and the more diligent he is with his Trading Plan, the greater the chance of success.
What should your business plan include?
First of all, you really wish you had written in your own words a description of your entry points, how you manage your trade, and how you exit your trade.
Now this will change as you progress through the different stages of being a professional Trader (from Paper Trader to Demo Trader to Live Trader).
Included in our Forex education programs are sample trading plans that cover all the main aspects of each of these distinct and vital stages.
Your plan should cover different aspects, including your routine, your way of thinking, addressing your weaknesses and building on your strengths, your goals for the day, the week, the month, and the year.
It is important to include goals in your Plan – this is the area you want to go into as much detail as possible, it is the area that will motivate you to achieve your goals.
The Objectives section is where you’ll go first when you’re having a hard time staying on track.
Your trading journal (when you plan to trade, including the session) should also be included in your trading plan, as well as the time you spend recording your trades and the time you review past trades to look for areas of development.
Your Trading Plan is a Living Document
You should review your Plan at the beginning of each trading session, as it will enforce your trading style, and you should at least update your Trading Plan every week.
One of my friends who is a trader told me this once (well, more than once) “you can have all the trading tools in the world, but if you don’t have a plan for how you’re going to use them, then you’re going to have a hard time trying to be successful.” with them”
Trading Plans: Your Business Trading Plan for Success
The reason I am passionate about trading plans is that I did a review of my trading plan recently and found that once I was done reviewing and updating it, I traded with more confidence and freedom than I have since April 2003.
The other reason; What is most important to me, is that every trader I have worked with has experienced amazing trading results after clearly writing their Plans and using them to keep them on track.
I also recommend having a plan for each phase of your trading business: paper trading, demo trading, and live trading. Each phase of your business is different and you should have structures, goals and measurements for each phase.
These are the plans I use when I trade and the ones I recommend all my clients use as well.