How I Treat My Trading Like a Business [Step by Step]

Your favorite gurus and traders will always tell you to treat trading like a business. But what does that even mean? It's kind of a vague term. Here is a roadmap, if you will, a blueprint, the way I sort of treat my trading as a business. And this is inspired by Tom Dante, okay? It's a roadmap he laid out. I'm just plugging in the way that I trade to this plan, okay? So all credits to him. If you want to learn how to treat your trading like a business, like a professional, keep your eyes peeled, take some notes, and see how you can plug your own trading model into this framework as well. Okay? So first of all, when you're trading, you want to have strategic business goals in place, okay? You don't want to just be in there willy nilly not knowing what you're doing. You got to think from the start. What are you trading for? What are your business goals as a trader? Number one, conserve your capital. Protect the money you have put aside to trade with the money you've grown to trade with. You want to conserve that capital. Number two, you want to generate income from that capital. And number three, you want to increase your account size. Okay? So that's the strategic business goals in place for my trading. That's what I want to achieve with the money set aside to trade with. Okay? Nice and simple, the next thing. Now, this isn't talked about too much in the online trading space, but this is quite a good point that Tom made. So you want to think about the risk of having your money with your broker. Now, you probably have seen people who trade large personal accounts, they keep the entire capital in their trading account. So say you have 20, $25,000 to trade with. They keep the whole 25k in their broker. Now, I don't have to tell you why this is a bad idea, but you get the picture, right? If you have all your money in one place, one broker, if that broker goes under, there goes your money. Okay? So keeping 10% of my total trading capital with my chosen broker, okay? So at the moment I'm just trading a 10k personal account. I have a funded account with Top Step as well, but with my personal account, I have a 10k USD personal account and I'm only storing 10% of that trading capital in any one time, okay? So my profit for the week, I withdraw from the broker until it is again totaling 10% of the total trading capital at any one time, okay? And what I've found is that this also protects you from going Wild and gambling. Imagine you have a really bad day. Sometimes those psychologically bad days that shouldn't happen still do happen. Okay, so imagine you have your full account balance. So you have your full 10k in your personal trading account. You have a really emotional day and you go on full tilt and you blow that account. You've just blown that entire 10k. But if you're only keeping 10% of your total trading capital in your brokerage account, not only are you protecting yourself from anything happening to that broker, but also you're protecting your capital from yourself. Okay, you've only got $1,000 in there. That's all you can blow on that day. Okay, you're only blowing that $1,000. I have $10,000 set aside to trade with. It's dedicated to trading. But 9,000 of that sits in a savings account earning interest. While $1,000, 10% of that is in the brokerage account being actively traded. Okay? I'm trading that thousand as if it was $10,000. Okay? Now the next step to treating your trading like a proper business is having the proper trading tools. Okay? You don't want to be working with cheap tools or unreliable tools. Think about if you are a construction worker, for example. You want to be working with the very best, most high quality tools to build your houses, to build your constructions. Okay? So same thing with trading. You want to make sure you're working with the top quality softwares, top quality tools to ensure that you are operating at a high level. Okay, Number one, you want a reputable broker or prop firm with a good history and low fees. So for me, my personal account is run through AMP Futures. My prop firm account is done through topstep. Okay, Purely because AMP has very low fees for trading futures and Top Step has a very good history. They were actually the original prop firm in the direct to consumer prop firm space. One of the many reasons I have my prop firm account with them, that's in terms of brokers and prop firms. Good charting software. You want really good, high quality, reliable charting software. I use TradingView and I used to just use the basic version. But since I started taking trading seriously, I've paid for the pro plan. I want to make sure I have access to full functionality. Got live data paid through Trading View. Okay, Very good top of the line software is Trading View for me. Next you want a good news service. For me I personally use DailyFX and next you want a journal to record your trades. For me I just use Notion. I don't actually have any paid journal. Software that I use and in fact I'll show you the journal I use now. So here is my trading journal. Made it myself in notion, just a note taking app. And here I've got my link to my economic calendar. So there is daily effects as I was talking about earlier. I can come in here at the start of the day and I check, for example go to Monday, I can see, you know, what news events we have tomorrow. So nothing to worry about tomorrow. But I check that at the start of every day. So there's my news service and there's my trading journal. Okay, so every day this is last week's results. I didn't trade for the last week and a half. So I started trading Wednesday last week as you can see, journaled my trades, track of how many points I won or lost for the day. I have a checklist of my strategy to make sure I followed all my rules and just little notes on the trade. Give myself a pat on the back if I followed all the rules and tell myself to keep doing what I'm doing or if I've done something wrong. For example on Friday, did something wrong, I woke up late and I also tried to trade later in the day and evidently did not follow my couple of my rules, my conditions for entry. So it's a bit of a naughty boy on Friday. So here's how I journal and record my trades and then at the end of the week I come in and do a week's review. Just some bullet points on what I learned from the week and I look for repeating trends. Okay, so I'll get into that a bit later. That is my journal software. Next you want to have a good routine, okay, so you want a pre session game plan. What are you doing before your trading session starts to make sure that you are trading like a professional, like a business. So for example, for me that means coming in, I trade the PM session of the New York trading session. Okay? Strictly trade the afternoon session. The reason being is I live in New Zealand and it's only realistic for me to capture the last session of the day in New York. So that means I'm coming in at 1pm Eastern time. And what I'm doing is I'm waking up my time. I wake up 4:30am which gives me half an hour until the trading session starts. And between 4:30am and 5:00am when the trading session starts for me, I am going into my charts and I'm marking out my levels. Okay? My pre session game plan involves marking out which levels I expect to do business at where I'm looking to take my trades, which we'll get into in the next point. But I'm marking out all my levels, getting my journal software ready, checking the news, and I'm coming in here, making my coffee ready to go, my gallon of water. And that is my pre session routine. My pre session ritual, okay? Marking up the charts, having coffee and dialing in. And you also want to have total focus during your session, okay? And this is why I had to evidently stop streaming my trading sessions, okay? Because I just found that even while I was saying to myself that I'll ignore the chat, I'm not focused on the fact that I'm streaming. It was still there and clouding my mind, okay? So evidently I had to stop streaming so that I could have total focus during my trading sessions, okay? So when I'm trading, I'm totally locked in. My phone's on, do not disturb, even if the markets are not doing anything interesting. I'm not opening any other tabs, I'm not on my phone, scrolling Instagram, TikTok, Twitter, whatever. I'm just purely dialed in, watching prices print, waiting for it to come to my level and trading from there, okay? So you want to be totally focused. You're in the hunt. When you're actively in a trading session, you are actively hunting your setup, okay? And you don't want to be. You don't want that to be hindered by any means, okay? Total focus after that. You also want to have a good post session routine. So for me, that involves recording my p. L for the day, recording how many points I've won or lost on the day, and then recording in my journal in here, for example, I come in, like we said earlier, I screenshot the trade that I took and I screenshot the setup, tick all the boxes if I follow all the rules. Great, that's a good trading day for me. And I'll just note down anything that I noticed, whether good or bad. It's just been a good day. I'll just pat myself on the back and say, keep on doing what you're doing, buddy. Pretty much so as you can see from there. And if I've done something bad, I'll just make a note of that for the end of week review. And then after I've recorded my trading in the trading journal, then I'll leave the room, go do a half an hour's worth of exercise on the treadmill, bit of cardio, clear the mind, reset, and get started with my day, okay? Have your routine Pre session routine and post session routine. Next, you want to have a plan for execution. Okay? So that involves what you want to see, where you want to see it, when you want to see it. Okay? Three important things to note. You don't want to just be coming into the trading day looking at the chart and just reacting to every little movement, every little setup that you see. You want to have your levels predefined, know what you're looking for and when you are looking for those. Okay? And I'm going to show you an example in the chart last week. Okay, so here we are. This is Wednesday on the micro nasdaq. And like I said, I've done my pre session routine. Okay, so I've come in, I've marked out the previous day's high, previous day's low, the AM session high, AM session low. Okay. I've done my higher time frame analysis. I know that we're digging into a weekly and daily order block. So my bias for the day is bullish. Right. I'm expecting higher pricing and we've now officially touched into that level. And what I'd like to do is when we are trading below lows, and if my bias is bullish for the week, then that's the prime time to start looking for long. So we're below the previous day's low, below the AM sessions low. Right. So we're now at my levels of interest, so I know what, so the three W's or what, where and when. Okay, so I know I'm looking for what bullish prices, where at the previous day's low, AM session lows and at the higher time frame PD array. And when, so I trade from 1pm through to 4pm it's the afternoon session kill zone, if you will, for ICT students, as you know. So at 1pm I'm coming in and I'm looking to start trading from 1pm so let's just play the chart here. So we're at my areas of interest. Now play the chart. I'll show you my. You'll see my live execution shortly. It's the five minute chart. Okay, so we've had that shift in market structure. My insert, I've entered the trade. Right around here is where I get my entry and there's where I get my exit. 40 points. Okay. And I'll show you the live execution. And there you can see my live execution. Okay, So I waited. What higher prices? Where below? Previous day's low, below the AM sessions low. After touching the weekly and daily order block and when from 1pm through to 4pm so at 1pm I took my trade. Boom. My exact setup took the trade. My predefined take profit and stop loss were entered. 20 point stop loss, 40 point take profit exited, done for the day. Okay? So it's important to have that plan. What, where and when next you want to know what your risk is. What risk are you willing to put up per trade and per day? Okay? So for me personally, per trade, I risk 20 points. And here you can see my risk management plan. So for every $2,000, I add one micro contract in my personal account, okay? So with the $10,000 personal account at 5 micros, so I'm risking 20 points per trade, 40 points per day maximum. Okay? So I have this defined for me and I recommend doing the same for yourself as well. Have a risk management plan just like this laid out so you know and how much you are willing to risk per trade and per day. So I'm willing to risk per trade 20 points and per day 40 points and nothing more than that, okay? So if I've hit those limits, then I stop, okay? Nothing more, nothing less. Now the last part is psychological, okay? Psych. Now this is where the journal comes into play. You want to constantly be improving yourself, okay? Tom Dante put it best. It's not your strategy per se, that is the edge, but you are the edge in trading, okay? So you want to constantly be improving yourself and figuring out where your problems are, what is holding you back psychologically, what you are doing well psychologically. And basically you want to do less of what's not working and more of what is working. Okay? I'll show you on my journal what I mean by this. So at the end of every week, so as you can see, Monday to Friday, the end of every week, I'll go back and I'll review each individual day, each individual trade, and I'll see what I did right, what I did wrong. And I'm looking for common trends, okay? And then at the end of the week, on the Saturday, I'll do a week's review and I'll just bullet point what I've noticed for the week, what I've done wrong, what I've done right. Okay? So I wrote great trading this week. On the days that I did trade, Friday was a loss because I attempted a continuation trade late in the day, since I woke up late. Do not trade if I am late. And then another one was ensure to wait for displacement before trading. Two times this week, I did not wait for proper displacement before Taking my trade, which caused me to take a loss. So I'm looking for these common trends, these common problems. Psychologically, it's not my strategy fault, but it's myself personally. I'm either not following a rule or not following my routine properly. As you can see, I woke up late that caused me to get a bad trade on Friday. If I had just woken up earlier, my setup happened earlier and I would have had zero little to no drawdown and I would have walked away plus 40 points on the day. But no, woke up late, still tried to take a trade and that was a loss. So I take these points and I carry them over into the next week. So I keep these in mind. I write them down on a little journal I have right here on my desk. I write them down, have them looking at me, staring me in the face for the entire week. And I'm trying to improve on the things I did wrong and continue doing the things that I did right. Okay? That's what I recommend doing. Keep a record of your trades, make note of what you did right and wrong in each day. And at the end of the week, review that, look for the repeating trends and stare them in the face until you've fixed and remedied the things that are holding you back, doing more of what is moving you forward. So that's how I have my plan laid out, my blueprint, my trade business, trading plan, okay? And it's important to have some sort of structure like this, to have things laid out professionally, know what you're doing and have everything well defined, okay? I see a problem with a lot of traders, new traders and myself included earlier, as well. As you go in with no plan, you have no idea what you're targeting in terms of risk, reward, what you're looking to profit for the week, for the day, while you're looking to risk you just running around like a headless chicken. You have none of this laid out. You're not trading professionally, you're not recording things, you're not improving on things, you're just gambling. Gambling, okay? Without this, you are literally just gambling, okay? So it's very important to have some structure like this. This is how you put yourself ahead of other traders, okay? A lot of people are not willing to do this. You have to be willing to knuckle down if you want to take this seriously. Trade professionally for yourself. You have to be able to lay out a framework like this and know what you are doing every single day and continually improving upon yourself. Hope that helps.