toolbox

 

 

 

 

 

 

 

 

 

 

    1. A trader must have quantified entry signals that tell them when to enter where the probabilities of success are in their favor of being profitable.

    2. A trader must build a robust trading system with a positive expectation model of a high winning percent of trades or one that will have bigger wins than losses long term.

    3. A trader must have a concrete plan on where to exit a trade at a loss or where to take profits before they take the entry.

    4. A trader must limit the capital at risk per trade to bring down their risk of ruin to zero. This depends on winning percentage, position sizing, and where stops are placed.

    5. A trader must have a watch list of the vehicles that they will trade.

    6. Each of us must understand and trade position sizes that keep the volume of our emotions and ego down to a manageable level.

    7. We have to pick the time frame we will be trading off of and keep our trades with in our chosen boundaries.

    8. We have to have good risk/reward set ups in our trading where we can be rewarded to make the risk worthwhile.

    9. Our trading must be based on math, probabilities, logic, and reason, not opinions, emotions, or ego.

    10. We need to have a successful trader that we can use as a model for our own success.