Wondering why you get great results back-trading and fail live trading? Are you blaming it on execution or a faulty trading system? Are you frustrated with a lack of progress in your trading?
You are not alone. These and many other challenges traders have are blamed on the wrong things and as a result traders system hop instead of dealing with the real issues. Many of these challenges can be overcome through the proper use of back trading.
OBJECTIVE: To have your live trading more closely match your back testing results. This information pertains to market neutral trading as opposed to directional trading.
The Five Stage Process – Part 1 of 2
Take a quick look at the session introduction:
More questions on content?
Part 1 of 2 covers:
- Human nature, goal setting and the importance of proper mindset
- Why are my back testing results great but my live trading results are not?
- Stage 1 – Is the system capable of making money?
- Stage 2 – Is the system likely to work with my schedule and risk tolerance?
- Stage 3 – How am I going to mechanically trade this thing?
- Stage 4 – How will my charting, news, biases, and psychology affect the system?
Part 2 of 2 covers:
- Importance of having a trade plan
- Evaluating risk vs. reward
- How am I going to handle large moves, overnight gaps, and catastrophic situations?
- Defense Condition Levels and how they apply to the market
- Defcon document available for download
- Trade Debrief Process
- Create a Success Loop to skyrocket your results
How a “Success Loop” is created by using the five stages:
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