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Chapter 29, Part III. Dealing Directly With Trading Plan (Finally!) Page 4

Discussion in 'Complete Trading Education- Forex Military School' started by Sive Morten, Dec 27, 2013.

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  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Pipruit: And what is drawdown?​


    Commander in Pips: Well this is the distance between the most recent high of assets in your account to the next lowest level.

    Another type of target could be much more ambitious – earn 100-150% annually. That’s quite a different story. In this case you have to spend much more time in front of your monitor. Time that will be dedicated to trading will be significant, since you will have to prepare 3-4 trading plans per day, or even greater. You hardly could work somewhere else. You will need good software and a data supplier, a fast internet connection and a good broker. So, your expenses will be much greater. You will have to apply much greater risk and leverage so your drawdown could be greater. You have to get a solid knowledge of market mechanics, since you mostly will trade on intraday charts, where behavior of dealers and market-makers are crucial to understand. Since you will not have a minute to rest while you’re trading you need an excellent stress-control system. Your trading expenses, such as fees and commissions will be greater.

    From the other side, you will have a lot of opportunities to trade and your trades will be fast. Since you will trade mostly intraday - your initial trading account value could be much smaller, because orders will be much tighter.

    So make your choice by yourself. Still, as we already once said – trading on longer time frames is simpler, just because you have a lot of time to think.

    Anyway both approaches demand discipline and study. The second approach demands more time on study.





    Pipruit: Well, I see. Probably, since I have no good knowledge of market mechanics, and have just started with this business, I’ll try to trade daily initially. Beside, I have a job that I can’t leave right now and I have to feed my family.​


    Commander in Pips: Reasonable choice.

    Now the second question that has to be resolved before starting with your trading plan directly is the one about your life style. How much time could you spend on trading?
     
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