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Glossary / Psychology

Trading plan

Definition

A written description of what you trade, when, at what size and when you stop.

Why it matters

A plan you never review is decoration. Pair it with a journal so each rule can be tested against real results.

Example

A written plan reads: Long ES on a pullback to VWAP between 09:45 and 11:00, 2 contracts, 8-point stop, 16-point target, maximum 3 trades, stop for the day at -$600.

How to track it in a journal

TradeStack calculates the core performance numbers — win rate, average win and loss, profit factor, expectancy, drawdown and consistency — automatically from imported trades, so trading plan stops being something you estimate and becomes something you read.

Related terms

Overtrading
Taking more trades than your plan justifies.
Revenge trading
Taking a trade to recover a loss rather than because the setup appeared.
FOMO
Entering late because a move is already running without you.
Tilt
Trading while emotionally compromised after a loss or a big win.

Questions that use this term

Keep reading

Trading journal guides
Expectancy, profit factor, drawdown, backtesting and the PDT rule.
Free trading calculators
Position size, risk-reward, expectancy and options profit.
Expectancy calculator
Expected profit per trade from your own numbers.
Broker CSV export guides
Step-by-step exports for Tradovate, NinjaTrader, IBKR and more.
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