Effective Trade Documentation affords the trader many luxuries, one of which is the ability to learn from past mistakes - of which there will be many. This also helps to show any third parties that you are not a punter but a Professional Trader.
We cannot stress enough how well considered Trade Documentation and record keeping guidelines are for you.
Over time, the collected data will greatly improve your journey from beginner to professional trader.
Generally speaking (this is not advice) there are benefits with the tax office if you can demonstrate you are a professional trader. Good Trading Documentation is what professional traders have.
For a quick test as to whether you have adequate Trade Documentation inc Trading Plan, try and answer these questions quickly and easily:
- What is your best trading strategy, timeframe & trading pair? What's the average R:R of the different strategies you trade?
- Can you see when you last changed your trading plan and whether those changes have positive or negative results?
- Do you review your trades to make sure they follow your trading plan?
- Could you take your Trading plan & trade doc to a Tax office audit or to a meeting at the Bank asking for a bank loan without fear of being laughed at?
These questions are just a start. If you answered no to any of these, you should get help with your Trading Plan.
Without good trading documentation how can you identify areas for improvement and improve your trading results?
Contact Us if it's time to upgrade your Trading Plan.