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Trading Manifesto

Read this before every trading session.

On Probability​

  • The strategy is an edge, not a prediction.
  • Which trade will win or lose is not known, and no attempt is made to know it.
  • The goal is not to be right. The goal is to be profitable over many trades.
  • It's not about the next trade. It's about the next 20 trades.

On Process​

  • The process is executed from start to finish with complete indifference to the result.
  • No second-guessing. No hesitation. The plan is followed.
  • If the setup appears, the trade is taken. If it doesn't, wait.
  • Trust the system that was built.
  • The job is not to predict. The job is to execute.

On Emotions​

  • No emotion is attached to individual trades.
  • The market owes nothing to anyone.
  • No trade is treated as certain.
  • Some trades will lose. That is part of the process.

On Patterns and Relationships​

  • Every trade is a completely unique circumstance.
  • No relationships are created between trades.
  • The last trade has no bearing on this trade.
  • Individual trades are not important on the grand scale.

On Simplicity​

  • Keep it simple.
  • Do not overthink.
  • There is a plan. The plan is followed.
  • If there is no clear setup, there is no trade.

On Risk​

  • The stop loss is set. It is not moved.
  • No more is risked than was decided.
  • If the stop is hit, the analysis was wrong.
  • Winning this trade is not required. Surviving to take the next one is.

On Discipline​

  • Take the trade when the setup appears, even when scared.
  • Skip the trade when the setup is not there, even when bored.
  • Follow the stop loss, even when it hurts.
  • Stick to the position size, even when confident.
  • Walk away after the loss limit, even when revenge feels tempting.

The Commitment​

A trader is not a fortune teller. A trader is a probability manager.

The market is not predicted. It is responded to.

Follow the process. The profits follow.

Now trade.