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Many of the students I talk with have been through several e-mini trading education programs. I generally ask them about their trading style, and whether or not they have a written e-mini trading plan. The answer to this question is universally “no." Additionally, there is often a bit of indignation about writing a plan. After all, most traders claim they have their e-mini trading plan committed to memory. Without a written plan, how can you follow your personal trading rules? It is my opinion that every trader should begin the process of developing an e-mini trading plan within four weeks of the onset of real trading. Generally speaking, the first three weeks of the training process are spent on a simulator so a new trader can get a feel for entries that are successful and entries that are less than successful. We have all sorts of suggestions for successful entries and exits in the training manual; but it is one thing to read about entries and exits and a completely different thing to actually execute an entry or exit. My point is a simple one; in order to write a plan that you have to have more than a little "book learning," you need some actual “ chart time.” So, what kind of trading information is contained in a trading plan? Depending upon the individual, there can be a wide variety of information types included in any trading plan. After all, the plan is a highly personal document tailored to a unique individual. That being said, I would expect some of the topics might include: • What are my trading goals? • What markets will I trade? • How will I size and place my stops? • How will I enter trades? (This is one to spend some time and energy on; be specific and detailed in outlining your e-mini trade entries) • How will I exit trades? (Again, this is a topic to spend plenty of time with; just like trade entries, it is important to be specific and detailed in your planning) • What are my risk management rules? • What are my money management rules? • What trading style will I employ? • How will I him maintain discipline in my trading? What are some pre-market and post-market procedures I will follow? These are just a small sampling of some of the areas you want to cover in your trading plan. There are many other topics that are worthy of study and consideration. Most importantly, it is absolutely imperative that your trading plan is a written document. (I don't mean handwritten, but, more accurately, your plan should be a paper document) I can't explain why a written document is more effective than keeping trading ideas in your head, but individuals seem to universally agree that writing your e-mini trading plan and committing it to paper emblazons the trading ideas to memory. Further, a trading plan should be a dynamic document. It is not something you write one time and will live with; a good trading plan will go through many changes as you progress as a trader and your knowledge and skill increase. In summary, I encourage you to develop a written trading plan and update that plan as time and your skills warrant. Once you have a plan in place, a follow the rules set forth in the plan. Of course, you may have to frequently update your plan as you learn more about yourself and trading. Real Live Trading Doesn't Lie. Spend 3 days with me, in my trading room, and see if you are one of the many that can profit from a fresh and unique view on trading e-mini contracts. Sign up for your free trading experience by clicking here.
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