Designing A Killer Trading Plan
In This Chapter
Identifying business costs
Minimizing learning curve costs
Understanding order execution
Trading is a business, and developing as a trader means evolving as a business manager. Understanding the costs associated with the business helps you budget accordingly. Initially certain costs will be higher, and others will be lower. You’ll likely be paying more for education and your learning curve (a.k.a. losses) when you start out. As your trading evolves, those costs will go down, while subscriptions to analysis platforms and data services will go up.
Always keep in mind that losses are part of operating expenses. Minimizing them by managing risk is your goal — not eliminating them. This is done by determining proper trade allocation amounts and maximum loss per trade. Effectively executing trades is another step toward minimizing losses. We cover all these topics in this chapter.
Managing Your Costs
There are a variety of costs to consider with your trading — some are higher when you first start and many continue throughout your career. You need to think of trading as a business and manage these expenses so you can ...