The Option Trader’s Hedge Fund: A Business Framework for Trading Equity and Index Options
by Dennis A. Chen, Mark Sebastian
5. The Trading Plan
“Failing to plan is planning to fail.”
—Alan Lakein
Not every business has a business plan, but every successful trader has a trading plan. To make money consistently, you need a plan giving yourself a framework, defining the parameters, and keeping your focus.
Having a plan is not a prerequisite to starting a business. However, having a plan is usually a precursor to creating a successful business. Many people can start a business. The number of startups per year is large; but, in the end, only the ones with a plan that can be implemented well will survive and flourish. In the business of trading, successful traders have a trading plan that they follow. The reason for creating a trading plan is to guard against the emotional ...
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