Here is a simple Trade Management Plan based on the plan developed by Peter Brandt and explained in his excellent book “Diary of a Professional Commodity Trader”
Suppose you decide to buy a stock.
At time of purchase, you should have a complete plan on how to manage your trade.
Let us take a simple example.
Today is August 13, 2021
You have looked at different stocks in DreamTai and have decided to purchase a stock named Rapid7 ( Ticker Symbol: RPD)
As per DreamTai, the buy price is 113.40
Stop = 108.86
Let us make a Trading Plan for this trade.
Go to the following weblink for Trade Management Calculator
http://dreamtai.com/calc/trade_management.php
Let us assume that you have $100,000 total equity.
You just want to risk 1% of the total equity on this trade.
The entry price, as per DreamTai is 113.40
The Stop Price as per DreamTai is 108.86
Enter these values in the Trade Management Calculator and press the CALCULATE button.
You will get the complete Trading Plan for this Trade.
Take a printout of this page and refer to it every day, to track your trade.
When the stock reached Target 1, sell half the stock.
When the stock price reaches Target 2, activate the Three Day Trailing Stop Rule.
To learn more about 3 day trailing stop, go to the following link.
https://dreamtai.blogspot.com/2021/08/three-day-trailing-stop-rule-to-exit.html
