Free · from the Algo-Mntr risk curriculum
The pre-trade checklist
Ten questions, in order, before any order is sent. If any one of them has no answer, the trade is not ready — that is the whole method. Print it, keep it beside the screen, and work down it every single time until it is automatic.
10 items · print it with your browser’s print command and keep it beside the screen.
Before you look at a chart
Two questions that have nothing to do with the market and everything to do with whether you should be trading at all today.
Am I in a state to trade? Slept, fed, not angry, not chasing a loss.
Revenge trading and fatigue produce the largest losing days in almost every journal that gets audited. This is the cheapest filter in trading and the most frequently skipped.
Do I know what is scheduled today — releases, session opens, holidays?
Being surprised by a scheduled event is not bad luck. Volatility around a known release will hit a stop that would have survived any other hour.
The thesis
State the trade before you take it, in a form specific enough to be wrong.
In one sentence: what do I think happens, and why?
A thesis that cannot be said in a sentence is not a thesis, it is a feeling. If you cannot write it, you cannot review it later — and an unreviewable trade teaches you nothing whatever the outcome.
What would prove me wrong? Name the price or the condition.
This is the single most important line on the page. A trade with no invalidation has no stop that means anything, and the exit ends up chosen by pain rather than by plan.
Is this my setup, or am I just bored and looking for one?
Most accounts are not lost on bad trades; they are lost on trades that were never setups at all, taken during flat hours to feel productive.
The risk
Decided arithmetically, before entry, while you are still capable of arithmetic.
Where is the stop, and is it at a level that invalidates the thesis — not at a round number or a comfortable dollar amount?
A stop placed where the loss feels tolerable rather than where the idea is wrong will be hit by ordinary noise, repeatedly, while the thesis was fine.
What is my position size, calculated from that stop and my fixed percentage risk?
Size is an output, not an input. Choosing size first and then finding a stop that fits it is the mechanism behind almost every account-ending loss.
What does this take my total open risk to across every position?
Five uncorrelated trades at one percent are one risk of five percent when the correlation shows up — and correlation shows up precisely on the days it matters.
The exit
Both exits. Decided now, while neither is happening.
Where am I taking profit, and what is the reward-to-risk at that level?
Deciding the target after entry means deciding it while watching an open profit, which is when a plan is least likely to survive.
What will I do if it goes nowhere — how long does this thesis have?
Time stops are the most commonly missing rule in a plan. Capital tied up in a position doing nothing is not flat; it is an opportunity cost plus an open risk.
The rules underneath it
- If any question above has no answer, there is no trade. Not a smaller one — none.
- Risk per trade is a fixed percentage decided before the session, not a number chosen per idea.
- The stop moves only in the direction of reducing risk. Never away.
- Every trade is logged with its thesis and its invalidation, win or lose, before the next one is taken.
- A losing trade taken by the rules is a good trade. A winning trade taken outside them is a warning.
This checklist is educational material, not financial advice. It cannot make a strategy profitable and it does not reduce the risk inherent in trading. Most people who attempt trading lose money.
This is one page of a much larger course
The reasoning behind every line above — why size is an output, why a stop belongs at invalidation, how to audit your own journal for the mistake that keeps recurring — is Level 2 of the curriculum.