trading plan

A trading plan is a structured approach that outlines how a person will buy and sell financial assets, like stocks or currencies. It includes specific rules about when to enter or exit trades, how much to invest, and risk management strategies to protect against large losses. The plan helps traders make disciplined decisions based on their goals and market analysis, reducing emotional reactions and impulsive choices. Having a plan increases the chances of consistent performance and helps in managing uncertainties in the unpredictable financial markets.