The world of trading offers a lot of opportunity for personal growth and learning. Unfortunately, it can also be very damaging to the pockets of the ill prepared. In this section, we discuss everything from trading psychology to techniques. Remember, we offer free monthly seminars to help you learn and improve as a trader. Find out more here.
It’s a mistake to think that the tools make the trader. Below is a list of tools that every trader needs, but it’s important to learn as much as you can about trading and develop your own trading style.
Here’s what you need to get started as a trader:
- Cash: How much cash you need is a long debate. Ideally you’ll need two or three times your deposit per trade. You don’t need that much to do multiple trades at once. Having twice or three times as much as your deposit per trade will ensure that you don’t bust out when you have a losing streak.
- A brokerage account: Shop around to find a brokerage that is affordable, offers the tools you need and offers a support service to help you familiarise yourself with the account.
- Charting software: You don’t need anything fancy here. Most brokers offer free charting on their platforms or mobile applications.
- A computer: Again, don’t worry about buying the very best. Any computer that’s not too old will be enough.
- Internet connection: A reliable connection that won’t leave you in the lurch as you’re about to execute a stop loss will make your life easier.
Trading is about discipline, about having a plan and sticking to it. With this in mind, Just One Lap founder Simon Brown came up with the concept of a perfect trade.
The idea is to compile a checklist of things you want to adhere to on every trade. If you stuck to your strategy by checking every item on the list, you have executed a perfect trade (see video here for full details).
It’s important to remember the list only includes things you can control. Whether you made a profit or a loss, for example, is not included in the list. Profit is important, but we can’t always control whether we make a profit on a trade. That’s why our checklist only includes choices that we can control.
Below is an example of a perfect trade checklist. It’s important to eventually develop a checklist that reflects your personal trading strategy, but you can use this one to get started.
Your challenge is to do one perfect trade. When you manage that, celebrate your success, regardless of whether you made a profit. Try to do the same on your next trade, then the one after that, and the one after that. When you do a perfect trade, Tweet us using #PerfectTrade. We’ll celebrate with you!
- Did you get a signal?
- Did you enter on confirmation?
- Was your position size correct?
- Did you set a stop loss using your system?
- Was trade monitored correctly?
- Did you adjust stop loss correctly?
- Did you exit at your stop loss or target, using your system?