How Can You Determine Your Own Trading Systems?


Master Trader
Apr 17, 2013
People trade their beliefs, not the markets. There are thousands of trading systems that work over there (I mean some of the systems that are being marketed), but the most important issue why many who buy such trading systems fail is that the systems don’t fit them. For example, someone who’s cut out to be a scalper will fail with a swing trading system. Therefore, how can you determine a trading system that fits your personality?

Nigel Price

Master Trader
Jun 26, 2013
trial and error is probably most use to determine..... if they continue to use it, it fits..... if not, it doesn't....h

Yes, you need to find out what works for you. A good way to speed up the trial and error process though is to keep really good trading statistics. Average winner, average loser, success percentage, etc. There is nothing that gives you more confidence in your strategy than good statistics, the numbers don't lie.

Another thing is being able to look at your own personality with a critical eye, something which is quite difficult for many of us to do.

1. Identify your weaknesses and put in place rules to counter them. Prone to over trading? Limit your trading to 3 trades per week and stick to it. Prone to getting emotional with the market? Lower your position size. And so on.

2. Identify your strengths and exploit them. Maybe you have a good knack for a particular type of technical setup - well then trade that over and over again and nothing else. Perhaps you are good with fundamentals - use this knowledge to forecast trends perhaps.

Recognise and exploit your strengths, recognise and mitigate your weaknesses, keep your statistics.

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