Trading is an adventure for the individual. Sure, you can learn a methodology, go to a school and learn their Turtle Trade, it may work and it might not. The truth of the matter is that over time you’ll find things that work for you, and other things you wish you could have avoided. All of this experience will hopefully bring you closer to becoming a consistently profitable trader. One thing is for sure, that if you don’t journal what you do and build the correct habits, you won’t learn and you won’t advance. This is where the playbook can help.
The Playbook is a tool to consolidate significant trades you have developed. The reason a trade is in your playbook is because it has edge and perhaps even greater potential so you want to duplicate it and profit from it on a regular basis.
Ask yourself this question, if you executed a trade a thousand times would you make money from it? If so, then add it to your Playbook. Constantly develop and edit the Checks and entry and exit strategies in your trading plays. Make sure you are removing plays that do not work and adding trading plays that do work.
It’s important that you work on this habit of entering trades into your Playbook. Over time you will develop these plays, organize, purge, expand the usefulness, complexity and elegance. Part of this habit is to continually add conditionals in the form of if/then statements. These trades will become the foundation of your trading career.
Benefits of a Playbook
- Helps you identify the best setups for you
- Eliminate trades not worthy of your intellectual, emotional and financial capital
- Get bigger in your A+ setups
- Hold your trades for the real move
- Accelerate your learning curve
- Lower your trading stress so you can pull the trigger
- Take first step towards developing automated strategies
- Think thru trades like a pro, so you can adapt when the market changes
Your playbook should include certain things. Every trader’s playbook will contain these things, however your playbook may be different from others. The structure is not as important as having the basics, and those basics are outlined here:
- Descriptive title
- Strategy and market context
- Trade management
- Trade review
- Possible forks to this trade
How To Start
You may have trades that you are already familiar with that have edge, you feel comfortable with, and you’d like to develop. Open up the playbook template and document it. There are also trade setups in this course that you can start with. During the trading day you’ll be journaling what you do. At the end of the day, or in the moment of the trade, open a new playbook template and start recording. After the trading day is over, review the trades you’ve done, enter those that interest you to further develop into your playbook. Repeat this process after each trading session. Keep building your playbook, purge when necessary.
Playbook template download:
PowerPoint – Playbook Template
Keynote – Playbook Template