Designing a trading methodology – Part 4 Entry and exit signals
Having determined the objectives for your trading system and with a thorough understanding of what it is you want to achieve with your ‘edge’ it is now time to look at the entry and exit signals you will use. Specifying exit signals is a must! Too many discretionary traders and those lacking a disciplined approach […]
Designing a trading methodology – Part 3 Specify the objectives of your edge
Having set out on the path of constructing your own trading system, it is now time to consider the aims and objectives of your system. In other words, what you are really doing, and why you are doing it. If you don’t specify what you want your edge to deliver, how will you know when […]
Designing a trading methodology – Part 2Tools and resources
In last week’s blog we looked at the mindset required to begin designing and building your own trading system. This week we take a look at the tools and resources required to undertake the journey. To design your own system with an ‘edge’ over the market certain basic resources will be required. These resources include […]
Designing a trading methodology
Over the next few weeks I would like to focus on the steps and processes involved in designing a trading system. Whilst by no means an exhaustive list, it will provide an insight into the process for those interested in designing their own trading system and for those who are weighing up whether to develop […]
Reflections on 2009 and a plan for 2010
After a well earned break following a busy year, we are now back to business in 2010. As the year ahead begins to unfold I would like to take this opportunity to reflect on the events of 2009 and how this may help us with our trading plan this year. The first few months of […]
The knowledge gap
We firstly need to understand what knowledge actually is. Many spruikers spruik that all you need is knowledge and they have the knowledge that you need to get ahead. Well I have some bad news for you, knowledge alone will not do the trick for you. There are thousands of well educated derelict people around […]
There is more to it than just money
Maybe you can now understand that there is more to investing than just making money. It is an ongoing journey and transition process of acquiring new skills and improving them. Sure, you could say that the same applies to golf, gardening or stamp collection but few other environments provide the magnified pressure cauldron such as […]
The trading philosophy
Not everyone knows that a universal philosophy actually exists in the business of trading. Importantly, in order to be successful in the long run, this needs to be clearly understood and firmly burnt into the trader’s psyche. Anybody can place a few profitable trades—randomness will take of that. But to maintain that run of success […]
What is a trade?
The act of completing a trade, in essence, is very simple. A trade is simply executing a buy order, holding the ‘open’ position for a period of time and then executing a sell order. Selling short would be the opposite. The physical act of a trade is very simple. The two transactions (buying and selling) […]
The largest loss trade
As traders and investors, forgetting the past is not always a good thing. In order to learn and grow as successful investors we must learn from past mistakes and put rigour and rules in place to overcome the variables at play in the market – variables over which we have no control. The “largest loss […]