You are on page 1of 13

To invest in the continuous improvement of our skills and technologies in order to identify and

capitalize on trading opportunities in an ever-changing global marketplace.

http://www.thecrosshairstrader.com/2010/11/a-stock-traders-mission-statementand-goals/
Mission Statement
My mission is to trade the Crosshairs Technique correctly, competently and profitably as taught and
become a better trader every day by always following the Rules.
Goals
My goal is to trade the Crosshairs Process, trading only High Probability Trades (HPT) as defined by my
Plans for Entry, Trade Management, Exit and Money Management.
A) Pre-Trade1. I understand this is War! I must be prepared to do battle! My weapon is my Plan
2. Is my emotional state strong enough to get me through this battle? Am I exhibiting Focus, Patience and
Discipline? If not stay out!
3. Do I know the type of Market I’m to trade, Consolidating or Trending and the associated risk;
4. The source of the stocks and indexes in my trading basket are from a universe of optional stocks, with
a Beta > 1.5, and a daily volume > 750,000 shares.
5. Do I have HPT trades selected in both directions?
6. If there are no HPT, then NEXT or take the day off. I don’t have to trade. It is a choice I chose not to
take today.
7. What are the outside influences that could improve or destroy my trade, i.e. news (sectors at High Risk
to regulatory boards), earnings, warnings, Sectors FOMC, etc?
8. Remember, I trade the CHT Process the same day-in and day-out. There are no exceptions!

A partial position 1/2 or 1/3 if one or two conditions are not met. 8. 6. Trade a full position per the Money Management rules if all the above criteria are met in a trending market and somewhat less in a consolidating market. R/S or enter before break out. Am I disciplined and following the CHT rules for HPT? C) Trade Management. There is always enough time to compare the trade to my criteria.$3. 2.In the CHT Process know that it is not necessary to enter the trade immediately.Know my Target and my Stop out for an exit. Position size my entry for the risk involved in the trade. The Market must indicate it is moving in the direction of my trade using ES / NQ. Trade a Risk / Reward ratio of no less than 1:2 and more often at least 1:3 2. 5. D) should be within the following specifications: a) 2×8< 15. To enter a trade I must understand and verify the following: 1. D and/ or 144. this may be unidirectional in consolidating markets where you trade in the direction of the SMA Stack. The stock candle count on the entry chart and the next bigger chart ( W. In trending markets only trade Break Outs. A Crosshair must have fired (CHF) on the W. The Sector should show an indication it too is moving in the direction of my trade. Add to a winner when all criteria are eventually met. 4. 7. Trade Options at least 3 months out in time and at least 1 strike price in the money. 3.B) Entry. 3. b) 2×21> 40. . S/R lines are indicating a sufficiently profitable move > $2. Set the Target and the Stop loss on the price of the stock. 5. The Simple moving averages (SMA) are stacked at 279 (Crosses) for a break-out on the Daily chart (D) and Weekly charts (W) or the W can show a 79 with sufficient distance to 200 for profitable trade. understand a $2 move for a $20 stock is > 10% and that is sufficient for the options to reflect a reasonable profit. 1. That should provide an Option Delta of 60% to 70% with respect to the stock price movement for Risk/ Reward considerations. 4. Earnings are at least 5 trading days away.

The Stop loss can be predetermined by your maximum loss limit but understand a small loss limit can positively impact your probability of success. 5. E) Money Management – These are critically important if you plan to stay alive to fight again. . Take Profits quickly and often! And remember discretion is the better part of valor. You must balance these against each other. You are limited to no more than 3 trades at a time. Profits should be taken before reaching a S/R. if you can’t decide trade the ETF. 10. Two factors determine your exit. Never. 7. remember you can always get back in! 11.6. The Target is determined by the type of market and the trading history of the stock. 9. 1. 4. I must balance courage and common sense when staying in the trade.The exit is critical to being a successful trader. Never have multiple open positions in any one sector. Let your winners run and your losers run out quickly. It the trade continues to move. never ever add to a loser. 8. 3. 2. Remember small losses are the key to success in an environment where you may be wrong greater than 50% of the time. Never commit more than 10% of your trading account to any one trade! 3. you may want to take your money off the table! 4. Don’t give back. 6. Don’t change my rules and therefore my settings. The risk parameter should most often be a potential $3 gain to a possible $1 loss or greater. 1. D) Exit. the Target and the Stop loss you have set on entering the trade. The two most important factors in determining the Stop loss are the last S/R and providing enough margin for the trade to be successful. Never trade with more than 30% of your account at any one time! 2. If the trade proceeds in your direction move the Stop loss keeping it tight. The money may be better used in another trade. SO WHAT if it continues to run after you left! 5.

6. collaboration. Seldom trade a 1:2 Risk/ Reward Ratio. complete the following exercise. _____________________________ 3.html Mission statements should be clear. A) Write down what you think your top three strengths are as a trader. 7. ____________________________________________________________________________ I appreciate the crosshairs trader who allowed me to share this with everyone. . Take some time to fully work out your motives for being a trader. compliance. and innovation  Provide a coherent vision and opportunity for personal and professional growth  Maintain a culture of community. Every statement for every trader will be different. http://drw.com/2010/05/personal-trading-missionstatement. agile and entrepreneurial organization  Generate superior risk adjusted returns and steady earnings growth  Promote learning. transparency. and personalized. brief. accountability and respect  Recognize and reward individual.blogspot. team and firm-wide efforts http://dreamjobz-india. Always adhere to the Position Sizing rules given in Trade Management. risk management and quantitative research. _____________________________ 2. Core Values  Build a self-sustaining. Once you are able to put your mission statement down on paper it will serve as the bedrock to your future success as an online trading athlete. To help you develop the basics of a personal trading mission statement.com/about-us/mission-statement/ Mission Statement To empower an organization of exceptional individuals to identify and capture trading opportunities in the global markets by leveraging and integrating technology. integrity. 1. _____________________________ B) Write down three qualities you would like to have. or aspects of your trading you want to improve on.

Here are her answers to these questions: A) Write down what you think your top three strengths are. First are the answers from Debbie. My goal as an online trading athlete is to ____B______. I have a strong work ethic 3. Have more fun trading 3. I am a competitive athlete 2. _____________________________ 2. before she became a full-time trader. I will accomplish ____C______. _____________________________ To complete your first mission statement. 1. _____________________________ 3.1.” Here are some examples of how traders we know have used the above exercise to develop their own personal trading mission statements. trading part-time. 1. Show more patience C) Now write down three things that you can expect if you are successful as an online trading athlete 1. _____________________________ 3. More discipline 2. fill in the blanks below with your answers to the questions above: “I am ____A______. Debbie was also a nationally ranked tennis player in college. Satisfaction in my career choice Debbie’s Personal Trading Mission Statement : . _____________________________ 2. _____________________________ C) Now write down three things that you can expect if you are successful as an online trading athlete 1. Recognition from peers 3. I enjoy working with people B) Write down three qualities you would like to have or improve on. an experienced trader who spent six years in various aspects of customer relations with a financial services institution. Financial security 2. By sticking to my game plan.

Debbie was able to identify clearly why she was trading. 1. Joel. It took several months of thought and self-discovery to understand why she was in the trading game. We will discuss dealing with slumps and setbacks in detail in Chapters 3 and 4. we change. I will make a game plan. and confident. . Once she got to this version. stick to it. I will enjoy my time trading. I want to know more about trading 2. Sticking to my personal game plan will enable me to become an all-star and achieve financial success. I enjoy life B) Write down three qualities you would like to have or improve on. she did not write this statement on her first attempt. Now that you have committed your first mission statement to paper make sure you post it over your “trading stadium” (desk area) so that you can read it whenever you need to remind yourself of your purpose and objectives. I need more confidence C) Now write down three things that you can expect if you are successful as an online trading athlete. this time from a rookie trader. she found that it made sense to her and kept her focused when she was having an off day or when she fell into a slump. I am willing to sacrifice to get what I want 3.“I am a competitive online trading athlete. We suggest an annual end-of-the year review of your personal mission statement to see if it needs updating. determined trader and I will commit myself to being the best trader I can be. A) Write down what you think your top three strengths are. and enjoy working hard until I retire.” Notice that when she completed her mission statement. and so our mission statements must change. My goal as on online trading athlete is to be smart. My goal is to be disciplined and patient every time I step up to serve in the trading game. Here is another example of the process of constructing a personal trading mission statement. something that makes you not want to give up easily. or trading skills change. who was 45 when he retired as a fireman and took up trading as an occupation. I do not want to gamble 3. However. I will impress my buddies Joel’s Personal Trading Mission Statement: “I am a strong. I will make a nest egg for my retirement years 2. The bottom line is a good mission statement is what works for you. and how it is a reflection of his unique personality and his approach to life. 1.” You can immediately see how Joel’s statement is vastly different from Debbie’s. 1. Over time. I am strong and determined 2. Be willing to add or alter your mission statement as you grow in your career as an online trading athlete. but realize that the ability to deal with failures begins with the self-knowledge that you are doing something worthwhile. prudent. I will be knowledgeable 3.

heard the expression.. Most traders have at some time or the other. By teaching the growing community of self-directed individuals The Pristine Method® of trading. open the hidden door on Wall Street.com | May 12. In order to accurately build your mission. The mission of Pristine's Education Department is to help turn the ever growing ranks of unsatisfied individual investors into selfempowered Master Traders/Investors.thefxmarkets.Alice in Wonderland) This famous quote strikes a chord. and teach not only what to do in the markets.com/.blogspot. and most importantly why it should be done. "Plan your trade then trade your plan.cfm How Traders Need to Prepare for Their Mission By TradingMarkets Research | TheFxMarkets. better informed. successful traders and investors by creating and providing the highest quality trading education available anywhere in the world. . But there is a much longer term connotation to planning that I want to address in this article. http://www.." This is essential advice for any trader to heed.then any road will get your there (Lewis Carroll . It is very necessary for us as traders to consider our purpose and our reasons for being a trader. Read more: http://dreamjobz-india. It deals with the trader's MISSION statement. but when to do it. we help empower and enlighten the individual. before jumping into a position in the market. 2010 If you don't know where you are going.site/forex/how_to/articles/-75812.com/2010/05/personal-trading-missionstatement.html#ixzz2RjFMTp65 Under Creative Commons License: Attribution http://proacttraders. where to do it.com/content/mission-statement Our mission is to create smarter. It is also very important to have a long term mission statement that will become the map we follow in order to bring us to our desired end results. you need to know the four basic trading profiles.You can’t hit a target you cannot see and you cannot see a target you do not have.

both in the short term and over the long term. Here your objective is not to take out the profits but rather to build wealth over a longer term. In defining your mission statement. You have decided that you want to trade full time for a living. For the purpose of this article. each of the above trading profiles require completely different approaches. Trading Profile 2. Trading Profile 4. Your objective is to generate spendable income each month that is sufficient to cover your lifestyle. Therefore. Trading Profile 3. Your objective here is to provide extra cash for your personal requirements. you need to outline exactly how you intend to reach your goals. In this profile you want to trade for a living. . Ask yourself the following questions. Step 1: Know what you need to earn. it is important that you pick your fit "upfront" and then focus on the specific requirements needed in each of the profiles in order to build your mission statement accordingly. it is important to know where you fit as a trader and what you want to achieve. such as your 401(K) plan or similar.Trading Profile 1. The first step is knowing your goals and how much money you will require to achieve them is. In this scenario your goal is to provide better than average returns for your clients and to earn a fee or percentage of the profits that you generate. let us assume that your chosen fit is Profile 3. A Series of Questions That Every Full Time Trader Should Ask Himself As you can imagine. This may be appropriate if you have a full time job and can only trade occasionally to supplement your income. Hence. Eventually you may want to offer your expertise as a trader on behalf of others. So first let us define the goals you are trying to reach. If you want to trade part time to make a little extra cash then this profile is the one for you. In this profile you want to trade to enhance the performance of your own retirement fund. Your goal is to earn your monthly income by becoming a full time trader.

The 8 losing trades lost a total of $960 or an average of $120 per trade. after taxes. in which case your annual cash requirement would be $14. each and every day.400 = $117.00 per day. Q: How well does my methodology perform?  Out of the past 20 trades how many were winners?  How many were losers?  What was the average win (total profits for the winning trades divided by the number of winning trades)?  What was the average loss (total losses for the losing trades divided by the number of losing trades)?  What is the average profit made per trade? Once you have a sense of your methodology's "expectancy". 12 trades were profitable and 8 were losing.  If I need to make $700 per day.000?  In my trading system. . Q: Do I have a methodology that I can use over and over again? (It must be the same exact strategy for entering each trade. then it's time to move on to the next step. I need to trade 5 or 6 times per day. you will need to make $700. how many trades do I need to make to earn $10. This is an average of $132.600 net.000 per month.000. Assume your tax rate to be 30%.000 per month gross. (please check with your tax advisor). Let us move to the next step to see what we need to consider in order to earn $700 each and every day. This equates to $9800 per month. Answer these questions to get a sense of your planning. repeat the exercise separately for each one. that will be sufficient to cover my expenses and savings? After doing your budget. Step 2: What kind of methodology must I employ? This step will help you better understand what you need to consider in order to earn $700 each and every day. If you trade 20 days per month on average. Therefore over twenty trades I made $3600 .Q: How much money do I need to take home each month.) If you have more than one trading system or strategy. The 12 trades made $3600 or an average of $300 per trade. if I require $10. Step 3: How much trading do I need to do each day? Q: Based on the above numbers.000 X 12 = $168. Deduct taxes of 30% or $50.00 per trade. do not mix systems for this exercise.$960 = $2640. assume that you need $14.

It is always important to keep stop loss orders in the market.Hopefully. I will need to make about 80 pips per trade or 20 pips in four trades to achieve my goals.  Now I have to choose the market in which I wish to trade. and that our winning trades are 2. I believe that the spot cash Forex markets with 100:1 leverage will be my best choice. I will need some leverage to effectively make it possible to earn $700 from relatively small moves. (See my previous article regarding positive feedback loops). so don't forget to take the stops losses into account. If I wait for large moves. and therefore. In the next step we need to calculate how much capital we need based on our risk profile and the specific market that we intend to trade. Step 5: How much capital do I need?  If I am prepared to risk up to 5% of my capital per trade.  Observing the Forex markets. Since I need to earn about $700 a day and to do this I need to take as many as 6 trades per day. we are prepared to increase the risk per trade to a maximum of 5%. Once you do this exercise.000 units. We believe our system would not have such a string of losing trades. we should be able to achieve our goals. if we put our system to work enough times. but since I will need a cushion in my account. I discover that each pip that the currency moves is worth about $10 and to trade that currency. I might not find enough trading opportunities every day. At 2% risk we would have to lose 50 times in a row to wipe out our capital. and my average loss is $120. Also we know that we win more than we lose and therefore. we can increase our risk appetite a little. At 5% we would have to lose 20 times in a row. Step 6: Which market could provide the opportunity to realize my goals? Since I need to make about $700 per day. we know that we have a profitable trading system. I need to double the amount to $5000. It is critically important that you know how to execute your strategy to consistently give you a profit. I now know what I have to achieve. But our analysis is not yet complete. This would be enough margin to cover two standard lots approximately. there is an opportunity to find 5 or 6 trades each and every day. how much capital do I need to start my trading account? To calculate this number I divide the average loss by the %risk. You will need to keep impeccable records so you can refine your trading skills and develop positive feedback loops. You will have targets that you must reach. Therefore.  Instead of only risking 2% of our trading capital per trade. In short by applying your mind to the design of a mission statement for your trading business. and you will have expenses such as transaction costs to take into account. So $120 / 5% = $2400. Now we have to ask ourselves the following questions. you will begin to treat trading like a business. you will be building a professional . Step 4: How much can I risk per trade? Since we know that we have 12 winning trades and 8 losing trades out of every 20 trades we make. If this is one of my goals. we can safely assume the higher risk. Sometimes you may have to make more than one attempt at a trade.5 times as profitable as our losing trades. I need to buy or sell a standard lot of 100.

professional.com. I touched upon three important factors in the Fusion Trading Model.com. with many of these mission statements eventually becoming household phrases. These personal mission statements often incorporate the financial . In this article.trader's mindset. By learning to execute well.A Foundation Course for Online Traders. So far in this series. Six Sigma is a statistical concept that suggests we aim for 100% flawless execution of our strategy rather than search for an elusive Holy Grail system that wins 100% of the time. which is the only way to become successful. In the next article I will go into more depth about the combination of all three. Investopedia explains 'Mission Statement' Mission statements aren't just for Fortune 500 companies. in simple and concise terms.Com and the author of Trading the Forex Markets . the amount of money that we need. http://14clicks.com/?p=1392 . Add this positive mindset to a well designed mission and we are on the road to building a successful trading business. More informationabout Fusion Trading can be found at www. the type of market to trade and the methodology to employ. Planning and preparation are important steps in becoming a trader. which I teach. over and over.fxnewsandviews.sharewealthsystems. we have discussed the need to apply a Six Sigma approach to trading. we begin to create positive feedback loops. as well as encouraging them to find innovative ways of moving towards an increasingly productive achievement of company goals. This leads to confidence and the ability to "pull the trigger" when we need to.How Changing Your Mind. its purposes for being. He is also a student of metaphysics for over thirty five years. This in turn helps the individual to keep a healthy work/life balance that increases their personal achievement in all of these areas. You can reach Selwyn at Selwyn@FxNewsandViews. It is not uncommon for the largest companies to spend many years and millions of dollars developing and refining their mission statement. Many of the most successful individuals. These statements serve a dual purpose by helping employees to remain focused on the tasks at hand. The course is designed to provide the trader with all the aspects of the Fusion Trading Model. both for the short term trade. spiritual and relational aspects of life. as well as the long term goals of your trading business. We can learn to execute well but I doubt that we will ever find a 100% winning system. Definition of 'Mission Statement' A short sentence or paragraph used by a company to explain. Selwyn Gishen is a trader with over fifteen years experience trading forex and equities for a private equity fund. He has written a book called "Mind . Can Change Your Life!" Selwyn is the founder of FXNewsandViews.com/how-to-write-mission-statement/ http://blog. professionals and investors have taken the time to craft a personal mission statement.

Goals and Objectives next blog in The Trading Plan series: . Google’s mission statement “is to organise the world’s information and make it universally accessible and useful”. It is. we will be able to remain on track and stay committed to our rules and trading processes through both the good and tough times. Below are a number of key points to consider for inclusion in your mission statement: o o o o o o o o o o The Mission Statement is a purposeful promise that can carry you towards your goals It is about you and your family.he Trading Plan – 1. By clearly defining this purpose or mission. Can’t wait until next week? Read the The Trading Plan – 2. To “make money” is not a purpose – it is an outcome. Each and every one of us will have a different purpose or mission for engaging the market. in essence. your driving purpose needs to be more clearly and concisely articulated. Mission statement 3 Comments · Posted by Gary Stone in Active Investor Education Don’t forget to ‘Like’ us on Facebook – Click the ‘Like’ button on the right The formation of our trading plan begins with our mission statement. and Needs to have a deadline – to ensure accountability A well structured mission statement can act as a silent ‘coach’ – keeping us focused and accountable in our quest to achieve our goals. Why are you investing in the market? What drives you? – providing for your kid’s future? – taking responsibility for your investments? What role will investing play in your life? Who are you doing this for? It is about growing as a person and as an investor It must also be able to accommodate changes that will occur over time and with experience – don’t make it too narrow. If your mission is powerful enough it will ensure you remain on track and help you retain your passion for trading or investing. This will ensure we aren’t tempted by greed during the good times and aren’t paralysed by fear when the tough times are upon us. It details WHY we are trading and investing in the market or markets we have chosen. Purpose drives one to persevere. it creates intense desire to overcome. our purpose. and your ideals Your purpose. your approach. A great example of a mission statement occurred in 1960 when JFK said that he would put a man on the moon by the end of the decade.