Trading plan: how to write and enforce

What a trading plan is and who needs it

This lesson explains how to write a trading plan — a one-page document that before the session answers four questions: what do I trade, when, with what risk, and under what conditions do I stop. We direct it to people who are finishing the demo stage or have already moved to a live account and want to turn decisions made “by feel” into a repeatable procedure. There is no promise of results here; there are fields to fill out, formulas, and limits that can be checked after the session.

A plan is valuable only when it exists outside the head. A memory version disappears exactly at the moment it is most needed, i.e. at the first loss or during a series of losses. Therefore, keep the plan on one page next to the monitor and return to it before every entry, not once per quarter.

Seven plan blocks — minimum scope

1. Goal and horizon — learning the process or supplementary income; you count the horizon in months, not in days.
2. Markets and sessions — list of instruments and hours in which you are allowed to trade them.
3. Risk — risk per transaction, daily limit, weekly limit, and maximum allowable number of open positions.
4. Setups — one to three named, ready to check off on the checklist.
5. Position management — partial close, stop move, trailing.
6. Information policy — what you do before macro data and during it.
7. Review — what you record and when you review the journal.

The third column is an illustrative number — base your own capital, your own thresholds, and your own hours. The starting capital itself is a separate decision: how much to deposit so that even a long series of losses does not change your life plans is resolved by the lesson Capital plan.

How to convert risk to złoty and position size

A percentage without an amount means nothing, because it cannot be compared with the cost of a single transaction. Three formulas turn the plan into numbers visible on the account:

1R in PLN         = capital × risk per transaction (%)
daily limit in PLN = daily limit in R × 1R
position size = risk in PLN / (stop distance × point value)

Illustrative example (illustrative number) for a capital of 10,000 PLN (Polish złoty) and 1% risk per transaction:

Three losses in a row exhaust the daily limit, not “somehow they will blow over.” It is this number — not the stress level — that decides when you end the session. All values in the table are illustrative numbers; enter your own capital, your own percentage, and your own limit.

If you cannot give the stop distance in points, you do not yet have a setup, and therefore you have nothing to calculate. Then return to setup definition.

Table to fill out: Your plan v1.0

Fill in the table below with your own data. You enter the “completed” status only when a specific number, name, or hour stands in the field.

As long as the “Risk per transaction” and “Setup 1” rows have TODO status, the plan is not ready for live trading — regardless of how good the rest of the document looks.

Plan versioning: v1.0, v1.1, and change log

Treat the plan like code. Every change gets a number, a date, and a reason based on journal data. Without this, after a month you cannot distinguish system improvement from chasing results after a weak week.

Rule: one change per week and never during the session. A change introduced directly after a loss, “to bounce back,” is not a new plan version, but an emotional reaction.

Polish specifics: costs, sessions, taxes, and supervision

The “markets and sessions” block has in Poland several specifics you will not find in English templates:

• Costs — spread, commission, swap, and round-trip cost counted together; only they show how much one entry really costs.
• Hours — the Warsaw Stock Exchange works in different hours than American markets, and the London and New York sessions have different liquidity; trading “after work” is often trading in the most expensive hours.
• Product and supervision — brokerage account vs CFD means different costs, different leverage, and different supervision. Choose one channel for version v1.0; mixing products in one risk block confuses limits.
• Taxes — profit settlement and capital gains tax affect what remains on the account after withdrawal. This is a plan element, not tax advice. The deadlines at which these settlements actually fall are sorted by the lesson Tax calendar.
• Company verification — check whether your broker operates under the supervision of the KNF or an EU equivalent, and record this fact in the infrastructure block.

When the trading plan says “do not trade”

Four conditions that are not negotiable during the session:

1. The Risk or Setup block has TODO status. As long as there are empty fields in the plan instead of a number and setup name, you do not open positions — even when the signal looks perfect.
2. The daily limit has been reached. Three losses at a 3R limit (illustrative number) end the day; you close the platform and return to trading in the next session, in standard size.
3. Spread exceeds the limit recorded in the plan. If entry cost is higher than the threshold in the document, you skip the signal — regardless of how good the chart looks.
4. You cannot indicate the invalidation level. Lack of a price at which the setup dies means lack of a stop-loss, and therefore lack of a calculated 1R; entry without this number is a bet, not a transaction.

Most common trading plan mistakes

• Plan without numbers — “reasonable risk” instead of a specific amount in złoty. Without a number, you cannot determine whether the limit has been broken.
• Plan copied from a forum — other people’s drawdown limits and other people’s setups do not fit your capital or your workday.
• Plan without versions — changes introduced “on the fly” in the middle of the week blur data in the journal and make comparison impossible.
• One risk block for two products — CFD and brokerage account have different costs, different leverage, and different supervision; count limits separately.
• Plan without a “when I do not trade” section — not trading is also a decision and must have a place in the document, not only in entries.
• Plan written as a profit target — “earn a set amount this month” is a wish; the plan describes the process and risk limits, not the outcome.

Measurable exercise

Write a v1.0 plan on one A4 page, filling out the table from this lesson. Mark fields you do not yet know as TODO before live. Then calculate three numbers: 1R in złoty, daily limit in złoty, and position size for your typical stop distance. Add the version date and read the plan before the next session. After a week, add version v1.1 only if you indicate in the journal data that justifies it — and only one change. The same fields are collected by the measurement protocol in Method.

Next step

From the setup definition make a checklist you check off before clicking, and then verify its rules in a backtest.

Check yourself

Common questions

How many setups to write in the first version?

One, maximum two. Each additional setup scatters the sample and means that none has enough data to say anything about it.

Does the plan have to include a profit forecast?

No, and it should not. The plan describes the process and risk limits. Expectancy is calculated later, on recorded transactions, not at the moment of writing the document.

When are you allowed to change the plan?

During review, with a date and reason based on data, usually once per week. Never during the session and never directly after a loss.

Why measure plan compliance if the account is growing?

Because a growing account does not tell you whether it is growing thanks to the rules or despite breaking them. Compliance measurement and result distribution in R let you distinguish process from luck, and without it you do not know which plan change actually helped. A few successful transactions outside the rules is a warning signal, not confirmation of effectiveness.