Just like in a business plan, a trading plan also needs to have a S.W.O.T. Analysis. S.W.O.T. is short for Strength, Weaknesses, Opportunities, and Threats. This analysis needs to be an objective look at an investor's personal attributes. It can help to have a friend help develop this part of the trading plan.
S.W.O.T. Analysis:
Strengths
• Willing to learn from others who are already successful.
• Ability to dedicate necessary time to continue advancing education.
• Proper discipline to handle losses well without going on “tilt.”
Weaknesses
• Lack of investing experience may cause a disadvantage at first.
• Personality tends to be stubborn, which could make it hard to accept losses.
• Cockiness may reveal itself after a few winning trades.
Opportunities
• Ability to dedicate more time than most to trading options.
• Opportunity to allocate more funds to trading if successful.
Threats
• Sometimes need instant gratification to stay motivated.
• Losing streak may affect me outside of my trading.
• Inability to learn from losses.
Please fill out Section 10.4 of the Trade Plan Template.
| < Prev | Next > |
|---|