The Road to Successful Trading

Example of Trading Rules. 
1) 
Do research early in the morning before trading. 
2) 
Do not alter selection filters unless you have paper traded the filters at least 100 trades at or 
above an average win-loss of 65%. 
3) 
Do not act on trading advice unless it checks with the filters and is within the scope of your 
expertise and trading plan. 
4) 
Do not trade more than 5% of the account balance on any one trade. 
5) 
Trade no more than 15% of the account balance on any one day. 
6) 
Follow the trading system checklist on each trade. 
7) 
If making any alteration to trading procedures, enter that into the trading journal and 
highlight. 
8) 
Stop trading if: 
ƒ If the trading account is drawn down below 35% 
ƒ If you have lost five consecutive trades. 
ƒ If you are tired, ill, emotionally upset, pressed for time or otherwise distracted.
ƒ If you are going on vacation. (smell the flowers) 
ƒ If you are not comfortable trading in the current state of the markets. 
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ƒ If you feel that you are trying to make up for losses. 

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ƒ If you feel negative or unsure. 
ƒ If you are getting bored. 
9) 
Review each closed trade within one week and make entries in the trading journal. 
10) 
Review the trading journal at least once each week. 
11) 
Engage a qualified mentor or join an appropriate trading group and share information freely. 
12) 
Take at least two online courses each year. 
13) 
Attend a trading seminar at least once each year. 
14) 
Do not discuss trading activities with non traders. 
15) 
Don not discuss losing trades with your spouse or other friends or family members. 
16) 
Get regular exercise and eat well. 
17) 
Find a method to help keep a positive attitude. (
www
.
thedisciplinedtrader.com
).
18) 
Reward you and spouse with dinner at a top restaurant when you meet your monthly goals. 
19) 
Make sure that you properly maintain all information systems and upgrade when it makes 
sense. 
20) 
Make sure that all trades have an appropriate confirmation. 
21) 
At the end of each month, cross check all trades with account balance. 
22) 
Move 30% of profits into the taxation account at the end of each month’s account audit. 
23) 
Establish separate accounts for each trading type. (stock options, currencies, commodities). 
24) 
Do not answer telephone during trading executions. 
25) 
Do not monitor trades more than three times per day. 
26) 
NEVER be without properly positioned stops. 
27) 
NEVER back off stops once set. 
Just to make sure that you understand the difference between the trading system and trading rules, 
the system is how to select and execute trades-from selection to Trading Journal entries. Trading 
rules, on the other hand, are established to minimize losses, help create a trading “gestalt” and to 
best match the trading environment to the preferences, personality and goals of the trader. 
Of course, who is going to enforce all these rules and procedures?
The obvious answer is “you”.
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