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A trading plan is a comprehensive decision-making tool for your trading activity. It should be your own, personal plan – you could use someone else’ s plan as an outline but remember that someone else’ s attitude towards risk and available capital could be vastly different from yours.

Your trading plan can include anything you would find useful, but it should always include:

1. Your motivation and goals

Ask yourself why you want to become a trader. Solid retirement? New career? Spend more time with family and friends? Write down what you want to achieve from trading.

Set weekly, monthly, and annual realistic profit goals in dollars or as a percentage of your portfolio, and reassess them regularly.

Any trading goal shouldn’t just be a simple statement, it should be specific,  measurable, attainable, relevant and time-bound (smart). For example, ‘I want to increase the value of my entire portfolio by 15% in the next 12 months’.

2. Trading strategies

Trading strategies are the core of the your trading plans. In this part you should state clear the particular currency pairs, time frames, entry & exit strategies, risk management rules, risk/reward ratios and other vital parts of your trading strategy.

Your trading strategy should tell you whether to go long or short depending on the trade setup, your entry and exit rules should define levels at which to enter into that trade and set your SL and TP levels.

A trading plan without well-defined risk management rules is not really a trading plan but a gambling plan. So make sure you have a reasonable risk management.

Besides, you should determine what is the minimum risk/reward you will accept. For example, if your will not take a trade unless the potential profit is at least three times greater than the risk, your stop loss is $1 per share and your goal should be a $3 per share in profit.

You should also know and record the strengths and