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Crafting a Trading Plan That Works for You

Just as every person is unique, so too, is every trader. I’ve mentored and taught thousands of traders throughout my career and have seen all types of people become successful at it.

And guess what? You too can become a successful trader. You just need to create a plan that works well with your risk tolerance and personality.

Below are some of the things I’ve learned about trading and personality over the course of my career and how you can use them to create a trading plan that puts you in the best position for success.

Risk Tolerance vs. Net Worth

I have had some very wealthy people as students over the years.

These traders might have a massive net worth, but that didn’t always translate to a high level of risk tolerance.

Some people simply can’t handle the thought of losing money in the market, even if losing it wouldn’t change a thing in their lives.

I once had a profitable trading student tell me that he needed to quit trading because the thought of losing any money was keeping him up at night.

I came to realize that a trader’s risk tolerance should be based on a level of investment that they feel comfortable with, not their net worth.

That’s why, if your positions are keeping you up at night, you should not be trading so big, even if you can “afford” to lose the money you have invested.

Invest Only The Time You Can Afford

Trading can be a very rewarding hobby for some and a full time career for others.

When you begin trading on your own, know how much time you want to spend doing it.

If trading is something you do only in your free time, shape your trading plan accordingly.

On the other hand, if you like to be in front of the screen for many hours of the day and plan on trading very actively, then you’ll likely be able to trade in markets the passive traders cannot.

Make this determination before you start and you’ll avoid losses while you’re “figuring out” what kind of trader you want to be.

Setting Yourself Up For Success

In essence, know how much time and money you’re comfortable committing to trading. These two points are the keys to setting yourself up for success.

Spending more time than you can spare studying markets adds unnecessary stress to your life.

Investing more money than you’re comfortable losing also adds stress, and makes it more difficult to become a profitable trader in the long run.

Make your trading sessions enjoyable and profitable by avoiding these stresses and you’ll be ready to navigate the market like a true AlphaShark!


Andrew Keene
AKA, “The Alpha Shark”

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Andrew Keene

Andrew Keene is the editor of The Alpha Shark research desk at Agora Financial. That includes the daily Alpha Shark Scanner PRO, the monthly Alpha Shark Letter and the bi-weekly CryptoShark Trader.

He’s also the founder of a seperate business called AlphaShark Trading which founded in 2011.

Andrew’s worked as a proprietary trader at the...

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