Author Topic: Improve your trading  (Read 739 times)

BWS

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Re: Improve your trading
« Reply #15 on: August 25, 2020, 02:41:28 PM »
So far, I have focused on the things we need to avoid doing. Now I will look at the positive side, the things that we can do to actively improve how we trade or invest.

There will be some differences depending on whether you are buying shares in a company or even a passive tracker fund, and trading forex, but the basic idea will be the same give or take a few tweaks here and there.
"I wouldn't say I'm the best manager in the business, but I'm probably in the top 1" - Brian Clough

BWS

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Re: Improve your trading
« Reply #16 on: August 25, 2020, 03:11:26 PM »
Plan and Record

You must have a plan.
This can be very simple or complex. I would suggest try to keep it as simple as possible to begin with, it can always evolve as time passes and circumstances change.

Your plan should take into account an honest assessment of your own competencies - be aware of your strengths and weaknesses and plan accordingly. It should also include an honest appraisal of your risk tolerance - how much can you afford to lose, how much does losing hurt - you dont want to cause yourself mental harm or undue stress. And it should also take account how much time you can, and are willing to, devote to it.

Do not try to copy someone else's plan - take responsibility now and create a plan that is as individual as you are.

Whatever the plan is, write it down so you have a record of it to refer to.

A clear, simple plan could be (please do not copy this, its just an example);

I will only trade Tuesday, Wednesday, and Thursday.
I will close trades 30 minutes before any major news events
I will only trade Eur/Usd or Gbp/Usd.
I will buy if XXX indicator is below price in AA, BB, and CC time frames.
I will sell if XXX indicator is above price in AA, BB, and CC time frames.
I will target N% of average daily pip move for the pair
I will set my stop loss N pips above/below support/resistance.
I will close all trades by 4:30pm on the day I open them.

For share trading any plan can be based on a vast number of criteria such as;
Are you investing short, medium, or long term?
If long term, what amount of fall in the value of your investments are you willing to accept before selling out?
Are you looking for high dividend yield, perhaps as income?
Do you want to be 'hands on' and invest in individual shares (note costs of buying/selling, time constraints) or would you prefer a tracker fund?
What are the tax implications? Can you make use of tax-efficient wrappers?

The simpler you can make your plan, the easier it will be to follow and the less likely it is that you will ignore it or forget steps.
Revisit the plan after a few months to assess if you need to amend parts, just don't chop and change it every time you have a bad loss or losing streak. Treat it as a work in progress rather than something that is cast in stone. Market conditions and your personal circumstances change and you may need to change your plan accordingly.








« Last Edit: August 25, 2020, 03:15:16 PM by BWS »
"I wouldn't say I'm the best manager in the business, but I'm probably in the top 1" - Brian Clough

Magyar

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Re: Improve your trading
« Reply #17 on: August 25, 2020, 03:56:04 PM »
Hello Bws.

I have my plan typed out and on wall next to me. It is a simple plan. Sometimes work sometimes not but i think the big problem is me not staying with it. I am not ready to change it yet but my win rate is disappointing less than 50% so need to correct this.

Kaitsu

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Re: Improve your trading
« Reply #18 on: August 26, 2020, 07:59:44 AM »
my win rate is disappointing less than 50% so need to correct this.
Do you mean those trades according to your plan or all your trades including those NOT according to your plan? It is important to rate only those trades taken according to your rules in order to decide whether this is a strategy problem or just a discipline issue! :)
Ships are safe in harbour - but that is not what ships are for......

BWS

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Re: Improve your trading
« Reply #19 on: August 28, 2020, 10:35:55 AM »
Depersonalise you plan

Think of your trading plan as if it were a business plan that you were proposing to investors or a bank. Remove feelings from it, stick to facts and numbers/percentages. Instead of writing it for yourself, imagine you are writing it for your bank manager or potential investor to scrutinise. You might be tempted to con yourself but you would be far less likely to offer anything other than the truth to investors. Consider how they might react, how they will dig into your plan looking for failings in it.

Avoid making changes to your plan, or rewriting it, while you are still trading and especially shortly after making a loss. Make notes by all means, but leave the changes until the weekend or month end so that you have time to mull things over before changing anything.
"I wouldn't say I'm the best manager in the business, but I'm probably in the top 1" - Brian Clough

Kaitsu

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Re: Improve your trading
« Reply #20 on: August 28, 2020, 11:22:18 AM »
Depersonalise you plan

Think of your trading plan as if it were a business plan that you were proposing to investors or a bank. Remove feelings from it, stick to facts and numbers/percentages. Instead of writing it for yourself, imagine you are writing it for your bank manager or potential investor to scrutinise. You might be tempted to con yourself but you would be far less likely to offer anything other than the truth to investors. Consider how they might react, how they will dig into your plan looking for failings in it.

Avoid making changes to your plan, or rewriting it, while you are still trading and especially shortly after making a loss. Make notes by all means, but leave the changes until the weekend or month end so that you have time to mull things over before changing anything.
Excellent advice!
Ships are safe in harbour - but that is not what ships are for......

BWS

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Re: Improve your trading
« Reply #21 on: September 04, 2020, 12:03:38 PM »
Question Yourself

Frequently traders, and especially retail traders,talk about how lonely trading can be. How there is no-one to discuss what they are doing or why. This makes things very difficult when we are starting out as we really have no-one to bounce our ideas off, and this is were forums come in.

Be aware, on some trading forums the quality of response you may receive can be dangerously poor, particularly if you are on a beginners forum where many other members will be of a similar low experience level as yourself. Forums or Trading Clubs which have higher percentages of experienced members, such as this one, may seem intimidating to begin with, but this is what you need to seek out.

If members challenge you, question you, try not to take this as personal as they are trying to establish your level and help you progress. Read discussions they have had with other members, it can be frustrating for members to see newcomers posting questions that have already been answered multiple times, so you can benefit yourself by searching for answers/topics before asking.

If someone points out that you are wrong, ask them why. If you learn the 'why' this can help you fully understand and look at things from a different viewpoint. And don't forget to 'like' or thank someone who has helped you out.
« Last Edit: September 04, 2020, 01:39:54 PM by BWS »
"I wouldn't say I'm the best manager in the business, but I'm probably in the top 1" - Brian Clough

Kaitsu

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Re: Improve your trading
« Reply #22 on: September 04, 2020, 01:00:41 PM »
Sure, we can go on forums such as this one but often the quality of response you may receive can be dangerously poor,
Not exactly the best vote of confidence for us veterans here!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

I don't know how I should take that - maybe I should just stop posting anything!  :'( :'( :'(
Ships are safe in harbour - but that is not what ships are for......

BWS

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Re: Improve your trading
« Reply #23 on: September 04, 2020, 01:36:00 PM »
Not exactly the best vote of confidence for us veterans here!
I did add 'particularly if you are on a beginners forum.'
Perhaps I need to re-word it.
"I wouldn't say I'm the best manager in the business, but I'm probably in the top 1" - Brian Clough

Kaitsu

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Re: Improve your trading
« Reply #24 on: September 04, 2020, 04:19:15 PM »
Perhaps I need to re-word it.
Reads a bit better now! :D

But I think you are right anyway, this is not a site noticeable for its training for Noobs, at least not yet, because there is only a handful of posters here and very few concrete discussions on actual trading issues, methods, etc - especially specifically related to trading forex. Lots of market comments, little on the "mechanics".

Personally, I have often tried to generate interest in trading methods with charts, etc over the last year since this site started but never succeeded in rousing any discussion at all. But I am sure the fault is all mine.

So, I do agree that if a noob has serious questions concerning trading methods, strategies, money management etc, then those other non-beginner sites are going to offer more response.

But I would also add that it is the responsibility of the Newbie to roll their sleeves up and actually study and test and ask and study and test and........... many of the Newbies I have come across in recent years are only interested in getting an off-the-shelf method that they do not need to understand further than the set of rules (which preferably are no more than two: in and out) and that does any require any knowledge of what is going on under the hood, so to speak.

In fact your point confirms my own doubts about being here at all.................................



Ships are safe in harbour - but that is not what ships are for......

eddieb

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Re: Improve your trading
« Reply #25 on: September 05, 2020, 08:38:16 AM »
it is the responsibility of the Newbie to roll their sleeves up and actually study
Good morning Kaitsu.
100% agree with the above but I think we both know from experience on BP that the vast majority of total noobs are either unwilling or incapable of doing this. They are lured in by promises of easy money and the last thing they want to consider is putting some effort in.

Regarding you trying to rouse discussions, I  have  to  hold my hands up and plead guilty here. I've  read most, if not all, of the posts here but only reply to a fraction of them, even those I wholeheartedly agree with.  That is a drawback of a new/small forum, it needs the majority of the members to be proactive rather than simply just reading posts.

I'm here for the long haul, I  like the vibe here and  the friendly atmosphere.

I'm enjoying this thread, thank you BWS, and look forward to your next 'chapter'.

Have a great weekend  guys and gals,

Namaste
Disclaimer. Posts are just my thoughts,  not recommendations.  Do your own due diligence before trading

PipMeHappy

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Re: Improve your trading
« Reply #26 on: September 06, 2020, 02:04:34 PM »
@eddieb agreed, people should leave comments
so that there is a plurality of voices being heard, not just
the 'inner circle'...

I do hope that this new forum will grow, as it is managed
responsibly and ethically,  keeping conversations civilised.

Thanks also to @Kaitsu for being such a valued participant
because he knows a thing or two about trading and it really
is rare to find someone like him willing to part with his time and
knowledge so generously.

PipMe

Pipstar

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Re: Improve your trading
« Reply #27 on: September 07, 2020, 02:02:20 PM »
I am guilty of just reading and not posting too. I guess  I  would post more if I knew more, but I  don't ask many questions  either. Its just how I  am.

PipMeHappy

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Re: Improve your trading
« Reply #28 on: September 08, 2020, 12:07:50 AM »
I am guilty of just reading and not posting too. I guess  I  would post more if I knew more, but I  don't ask many questions  either. Its just how I  am.

Fair enough, @Pipstar , though we would like to hear from you!

PipMeHappy

BWS

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Re: Improve your trading
« Reply #29 on: September 10, 2020, 02:20:18 PM »
Think, Question, Answer, Act

When you think of a trading idea, whether it be a forex pair, a commodity, or a company share, and it seems to fit your trading strategy, just pause for a moment before clicking 'Buy'.

Ask yourself does it really pass the tests your strategy should dictate. This asking puts a check in place prior to making the decision, giving you additional time to double check. Ask yourself if there is anything coming up soon that may affect your decision or the hoped-for outcome. This may be events on the economic calendar or events coming up on your own personal calendar such as a big wedding anniversary or holiday that you will need hard cash for.

When you are happy that all criteria have been met and that there are no 'surprises' lurking you are in a safer position to proceed.
« Last Edit: September 10, 2020, 02:43:49 PM by BWS »
"I wouldn't say I'm the best manager in the business, but I'm probably in the top 1" - Brian Clough