Saturday, April 19, 2008

Why you should make a trading plan?

 
The simple answer is that a trading plan will increase your chances of trading successfully in the long-term. A well-constructed trading plan will give you a process to select shares, clear guidelines on when to enter and exit the market and how much to invest in each particular trade. And most importantly it will help you take the emotion out of trading so that you make better decisions. Another advantage of a plan is that it forces you to be accountable. Each component of the plan should be signed off and tested which will help you to trade consistently.



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