Create
stock trading business plan to learn stock trade profitably

My trade stock central ideas that help
to learn how to trade stock market

Most traders and active investors think that best way how to learn to trade stocks is to create best stock picking system and then trade best stock picks.

The simple way to learn stock trade basics is to prepare your written plan for your trading business. Trading business ? Right. If you want to make money by simple stock trading then you must have stock trading as a business.

And as any other business owner is preparing his/her own business plan, stock trader should also prepare his own business plan. Such plan represents best way to learn how to trade stock as it covers all aspects of stock trading.

Stock trading terms
of good business plan

Your vision.

What is you vision? Why do you want to do stock trading ?

Example: "I want to create wealth for me and my family to be financially independent. " or " I want to create successful asset management firm and make money also for others"

Your objectives.

How do you accomplish your mission statement?

Like "I create stock trading system producing 20% profit p.a. with smallest drawdown possible"

A thorough self-assessment of your strengths and weakness based upon real trading logs that you collect (if you haven’t done so already).

What are you strengths? And what are your weakness?

A thorough assessment of the big picture and the fundamentals that might be behind any trend.

What is your opinion about global picture of world economy or about your local economy where you live.

Something like: " US Economy is very indebted. There will be necessary to decrease debt levels otherwise US dollar will be debased." or "Economy is very globalized and companies can move from one country to another" or " Regulation is bad / good for stock markets"

A complete understanding of your beliefs about the market.

What are your beliefs about stock market? What do you think about stock trading?

Here are some examples:"Stock trading is easy " or "stock trading is complicated" , "It is possible to learn to trade stocks profitably", "technical analysis works" , "fundamental analysis works" .

Write only what is relevant for you. Write as much points as possible as these beliefs will help you to create best stock trading system which will fit your personality.

Your procedures for developing and maintaining discipline.

How do you arrange that you will follow your stock trading system? How do you check if you are making mistakes or not ? How do you correct your mistakes ?

Your budget and cash flow systems.

It is hard to make living based on trading with very small account. If you do not have enough money, make money in some job and return to trading later. The truth is that size does matter in stock trading. The bigger your trading account is the better.

Your worst-case contingency plan.

What happens when Internet is down ? How do you close trades ? What if your computer is broken, how do you trade ? What is you have open trades and your electricity is switched off ?

System 1—which is compatible with the big picture.
System 2—which is also compatible with the big picture.
System 3—which might come into play should the big picture change.

Do you have more then one trading system for different market types?

If you have all of those things, then you have a chance of doing well and learn stock trade. But your business plan becomes a tool for you to continually use to improve yourself and your trading.

Best stock trading book
helps learn how to trade stock market

Super Trader, Expanded Edition: Make Consistent Profits in Good and Bad Markets Author: Van Tharp
I recommend this book very much.

You can find details about this book and order it from AMAZON

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