الموضوع منقول للفائدة :

WHAT MAKES A REALLY GOOD TRADING STRATEGY?
Part 1

Ask most NEW traders, and they will tell you about some moving
average or combination of indicators or a chart pattern that
they use.

This, as the more experienced trader knows, is important and
can give you an entry point but on it's own, it is NOT a
strategy.

Any trader who is more experienced will say a strategy should
also include your time frame, money management, risk control,
perhaps stop losses and of course, an exit point.

Let's just cover those points:

ENTRY
There are so many ways to determine a possible entry point it
is impossible to count them. You can use moving averages,
trend lines, chart patterns, candlestick patterns,
support/resistance levels and a wealth of technical indicators.
And that's apart from any fundamental analysis (profits,
dividends, PE ratios etc) you might care to do.

In fact there are so many ways of choosing an entry level that
it is beyond the scope of this article to go into them.
Strangely, this is also one of the LEAST important aspects of a
good strategy.

TIME FRAME
You need to decide if you want to be a Buy and Hold investor or
a shorter-term trader. Day Traders will have time frames in
minutes. Swing traders will look at a few days or weeks for a
trade.

MONEY MANAGEMENT & RISK CONTROL
Essentially, you must look at how much you are prepared to trade
with, how much you are prepared to risk on each individual trade
and the size of your trades. The objective is to preserve
capital if trading does not go well because once you are out of
capital you simply can't trade any more.

STOP LOSSES
Probably the hardest part of trading and it is always a
compromise. Some traders do not use stop losses at all. My
firm belief is that you absolutely must or you will have little
control over your maximum trade risk. Where to put your stop
loss must be an integral part of your strategy and once you
decide, you must stick to it.

EXIT POINT
There are two basic methods of deciding when to close a trade.
You can exit at a calculated target price by using various
technical tools including Fibonacci retracement, projections
from chart patterns and many others. Or you can use a trailing
stop and just stay in the trade until you are stopped out. Both
of these methods have their merits and downfalls.

So those are the basic ingredients of a strategy. They are
important BUT, those are not the only things that make up a
REALLY GOOD trading strategy.

There are two other vital ingredients. One of those things we
will cover now (in Part 1) and the other will be covered in
Part 2, which you will receive tomorrow.


YOUR TRADING PERSONALITY
A well-read and successful trader will tell you that your
strategy should fit with your "trading personality".

You may think this is an odd subject to cover but it is vitally
important and is another fundamental ingredient when designing
your trading strategy.

Let me explain.

We all have different personalities, some people are very
extrovert while others are shy and retiring. Some people
thrive on taking risks, others want guarantees on everything
before they make a decision and even if they do take a risk,
they want to sue someone if it all goes wrong.

My guess is that if you have got this far reading about trading,
you are prepared to take some risk at least. The trouble is,
that unless you have some experience of trading AND LOSING, you
will not know where your risk threshold is.

Try the following test. This is not scientific; it's mainly for
fun. Read each statement and score yourself on a scale of 0 if
you strongly disagree to 10 if you strongly agree. Then total
your score at the end.


Statements:

1. I believe you have to take risks in life or you will look
back with regret.

2. Fixed interest investments don't even keep pace with
inflation.

3. If you don't have an overdraft you lack imagination.

4. I drive fast even when I am not in a hurry.

5. I regard a loophole in the rules as a window of opportunity.

6. I like the adrenaline rush of risky and extreme sports.

7. I always add on a few extra items to an insurance claim.

8. I would sell a car for more than it's worth if I could get
away with it.

9. I always try to knock the price down on things I buy.

10. I always respond to chain letters promising to make me a
fortune within the next few weeks.

11. I am always so rushed for time that I have to eat or do my
make up while I'm driving.

12. I regularly try to anticipate when the lights will change at
a junction to beat the other cars away.

13. If my credit cards mount up, it doesn't worry me as long as
I can make the minimum payments or get another one.

14. I always say what I think and don't care if it upsets
people.

15. If I can find a way of doing something quicker I will.


YOUR TOTAL POINTS = ______


Total your score and check your risk rating below.


YOUR RISK PROFILE.

0 to 50 You got this article for free so you might as well
read it, right. But you won't start if it's past 9 pm in case
it keeps you up. Take my advice, make a cup of hot chocolate
and get an early night! Try to start life tomorrow.

51 to 100 It's ok, you are pretty normal but be worried
about any individual score where you have 11 or more.

101 to 150 Get therapy immediately! Do not use sharp
implements and cut down on caffeine. Try to sell this article
to your grandmother to make a profit and think about a career
as a bank robber - you should do well!

That was just a bit of fun but the statements are based around
three basic but important personality traits:

· Worry
· Patience
· Risk taking

Let's look at these in more detail.

The amount you worry about things will determine how you view a
trade before you even take it on. It also determines how you
will react if a trade begins to go against you.

If you are a worrier you could also have real doubts about your
strategy if you get three or four consecutive trades that don't
work out - you will not have the confidence to continue and let
the law of averages work over a longer period.

You could also be tempted to take a profit and run in case the
trade turns against you instead of sticking to the strategy that
could make an even larger profit.

Patience is important in trading. Sometimes things just don't
happen when you want them to.

Risk and reward are inextricably linked. It is absolutely true
that the more risk you take, the more POTENTIAL reward you might
get - BUT:

· Only if the risk is one you can feel comfortable in taking or
you will override your strategy.

· There is no point in wiping yourself out with two or three
trades that don't work out.

The more risk you take, the more worried you are likely to be
and therefore the more you are tempted to make an emotional
decision rather than stick to your strategy.

Trading decisions based on emotion rather than a set of rules
(strategy) will ALWAYS get you into trouble in the end.

Sometimes you will be lucky and your hunch will be right.
Unfortunately, that will lead you to make even more emotional
decisions and at that point you might as well forget any
strategy completely and trade on instinct and emotion.

******TRADING EMOTIONALLY IS A RECIPE FOR DISASTER******

!!!!!! GREED AND FEAR ARE THE TRADERS WORST ENEMY!!!!!!!

There is a good saying in trading, which is, "Cut your losses
quickly and let your profits run." This oversimplifies a
complex problem and the answer actually lies in using a sound
strategy AND sticking rigidly to it. Being able to stick to
the strategy is where your personality comes in.

It is also said that traders who let losses run hoping they
will turn round will go bust very quickly whereas traders who
take profits early will go bust slowly but BOTH will go bust.

The first rule of trading is to preserve capital -
- without it you cannot trade!

The strategy I have developed and trade every day is called
the "Short Swing Strategy" and is designed to help people
manage risk to any level that suits their own personality.
It will allow you to determine the maximum risk you are
prepared to take on, even before you open the trade. This is
due to an extremely precise but reliable way of using an
initial stop loss and calculate your position size.

It will allow profitable trades to run without watching a
large profit turn into a loss. This is because I use a simple
but effective system of trailing stops. My strategy shows you
EXACTLY where to place them.

In short, it WORKS! It allows me to sleep at nights knowing
that I make money in all market conditions. I haven't had a
losing month since I started trading the Short Swing Strategy.

I have published my complete strategy in a book called "Short
Swing Trading" which is immediately downloadable from my
website:

http://tinyurl.com/cjumm

Naturally I am not giving it away but you can always go to the
website and make up your own mind. I feel sure you'll find
it's worth every penny. Just one trade could cover the cost.

It is said that as people grow old they only regret the things
they DIDN'T do. They never regret the things they tried -
even if it failed. This is one risk that's worth a try.

A good strategy will take the worry away and substitute
excitement!

Part 2 of "What makes a really GOOD trading strategy" will be
sent to you by email tomorrow. I hope you enjoy it.

Enjoy your trading.


David Graeme-Smith
Short Swing Trading

للاخوة المتاجرون الجدد ,
المقال اذا تقيد به وعملنا بمحتوياته فسوف يكون عملكم متكامل .

للاطلاع والمناقشة لمن اراد .

شرايك ترجمه لنا بالعربي حبه حبه ,,, كثير من الأعضاء لا يجيد اللغة الإنجليزية .

ننتظر الجزء الثاني على أحر من الجمر

وفقكم الله

حرام عليكم وحنا مالنا خاطر عندكم
ليش ما تترجمونها لنا من شان نستفيد معاكم

Part 2

Yesterday we looked at the importance of using a strategy that
fits with your own "trading personality" and the fact that you
must trade your strategy without overriding it because through:

FEAR and GREED.

BUT when it comes to building a really effective trading
strategy, there is one other vital ingredient that many traders
forget - and that is to fully understand the "personality" of
the shares or index you trade.

Some traders specialise in say, gold or Brent crude or
currencies or they might specialise in a particular index such
as the FTSE 100 or the Dow Jones but many traders choose to
trade shares.

Indeed some traders dabble in a bit of everything. I think
this is the area that causes many traders to fail or at least
not reach their full potential.

In my view: You absolutely MUST specialise.

I am sure that on the surface most people would say that sounds
sensible but here is why it is a MUST!

Superficially, many charts look the same. I bet if you had not
seen the charts for some time and someone where to show you a
chart of Brent Crude over 6 months and then a chart of Barclays
PLC over the same 6 months you would be hard pushed to say
which was which purely on the look of the chart.

However, I bet that if you found a trader who trades ONLY
Barclays day in and day out and also found someone who trades
ONLY Brent Crude day in and day out, both of them would easily
identify which was which.

WHY?

Because every share, index or commodity has it's own
"personality".

Some will be volatile intra-day, some will follow their sector
or main index (market followers), some will do their own thing,
some will spike up and down regularly, some will stop at key
moving averages and some will just plough through. Some will
move by 5% on average before they retrace and some by 2%. Some
will gap up or down regularly, some will not. You get the idea!

Therefore, no matter how good you are at analysing indicators,
moving averages, trends and patterns, the same strategy WILL
NOT work for everything. A strategy that works well for Bovis
Homes, for example, might NOT to work for BT Group - they have
very different "personalities".

So let's return to our question: What makes a really good
trading strategy?

It is a combination of:

1. Your trading personality including attitude to risk and
whether your trading decisions are based on strategy or emotion
(fear & greed).

2. The "personality" of the index or share must be profiled,
understood and complement your strategy.

3. You must identify the most reliable method of determining
entry point, initial stop loss position, trailing stop and exit
point for that share or index "personality".

Then comes the most important bit.

ALL of those things must fit together perfectly. Imagine if
you had a Rolls Royce and the garage called up and said, "You
need a new set of pistons but don't worry, we'll fit a set of
Toyota ones, they're cheaper." One component wrong and the
whole thing becomes useless!

A good strategy MUST have EVERY ingredient working perfectly
in harmony to:

** Work in all market conditions.
** Make money whether the market is going up or down.
** Fit comfortably with you so that you don't override it.

Trading a strategy and sticking to it religiously is the ONLY
reliable way to make money consistently in the markets and
with the volatility in recent times you MUST look at smaller
but more reliable and
consistent profits.

Developing a strategy like this is very tough believe me. It
has taken me over three years of design, testing, re-design and
re-testing to get there. Add to that a great deal of anguish
and pain (even tears at times) as well as a lot of money and
it's not difficult to see why most traders make an overall loss
and even give up before getting it right.

But if it were easy, everyone would be doing it right?

Fortunately I got there and now trade full time for a living
- AND LOVE EVERY MINUTE OF IT!!!!!!!

The strategy I trade is actually quite simple (most good things
are) and all I have is just 6 trading rules to follow but it
earns me excellent profits every month.

If you want to shortcut the process of developing a reliable
strategy for yourself and save the time, pain and expense that
I and most other successful traders went through, I would be
delighted to let you trade my strategy. I will even provide
one month of free email support for you.

Every detail of my strategy which I trade on a daily basis is
in my book "Short Swing Trading".

Naturally I expect people who benefit from it to pay - after
all it represents three years of my life -- and can save you
three years of yours and a whole lot of losses -- but that's
your choice.

Here is what Paul Manley (a trader in the UK) said about
Short Swing Trading:

"It was very refreshing to read your book, I must say that of
all the books I have read in the last 6 years, this is
probably the most complete, informative, practical and no
nonsense approach, to trading I have seen. It's a pity I did
not have this 6 years ago, it would have saved me a lot of
money and even more time."

If you want to hear what other traders have said go to:

http://tinyurl.com/cjumm

The book is instantly downloadable so you could be learning
my strategy in 20 minutes. You never know, your first trade
could more than pay for the book.

Good luck and enjoy your trading.

David Graeme-Smith
Short Swing Trading