Just a brief note today.
How do you spend your time during the system development process?
It should be something like this:
- 30% working on your objectives
- 30% working on your position-sizing
- 30% working on your exit rules (So you can trade what’s in-front of you)
- 10% on your entries
To reinforce the point I asked a hedge fund manager what his top tip for future money managers was today. His answer:
“I’d say gain an understanding of the metrics that they need to achieve, ideally before embarking on creating the track record – then devise a risk management/trading strategy that achieves those metrics.”
Next:
How do you spend your time during the trading process?
It should be something like this:
- 30% on psychology (maintaining the right state)
- 30% on managing existing positions/ risk management
- 20% on your entries
- 20% on recording/ journaling/ debriefing
How does your time spent compare to these?
(By the way this applies to all traders not, just money managers)
About the Author
Sam Eder is a currency trader and author of the Definitive Guide to Developing a Winning Forex Trading System and the Advanced Forex Course for Smart Traders. He is a key team member at premium FX services provider www.fxww.com and part owner of Forex Signal Provider FX Renew (You can get a free trial). If you like Sam’s writing you can subscribe to his newsletter for free.