Rules

Trading rules

If you search the internet you will find many list of rules that traders follow and abide by - or at least claim to follow. The rules that you follow should be your own set of rules which should be a distillation of the following set of rules.

I've presented the rules in general order of importance. I've also attempted to dispel some myth rules at the end of this article.

How does a person rank rules? What are the criteria for putting one rule above the other? Ranking rules is subjective and it partly depends on your trading style and the instrument that you trade. Some rules may not even apply to you because your traded instrument or trading platform doesn't have that facility.

In order to get a feel for how other people ranked rules I took the 9 most common rules that I could find and placed a poll of these rules with a tenth option of "rule not mentioned" on two different forums to see what others thought of the 9 rules that I'd selected in order to help rate and rank them.

I'm not going to go into the specifics of how the voting was done etc. but I was encouraged to see that the top 2 were the same in both polls. In some way I feel that this was a type of verification of result. I'm going to order the rules according to the first survey because it has 4 times as many votes as the other one.