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Finding The Right Stock Trading System

Finding the right stock trading system can be a challenging task.  Yet it is a very important step along the journey to trading success.  The first step along this journey actually begins with a good long look in the mirror and a heart to heart conversation with the person staring back at you.  I kid you not!  To really choose the best stock trading strategy for you, you actually have to know something about yourself, first.  As with any good tradeplan or trade strategy, it ultimately will depend upon you and your ability and desire to get the most out of it.  Like most things worthwhile in life, you get back what you put into something and the same is true with learning how to trade as well as finding the stock trading strategy for you.  Much about trading depends upon personal style and the big dilemma for many, especially those just starting out is that they may not even know what ‘their’ style is.  There is however, a step by step way to figure this critical piece of information out before you make any serious commitments.

Ultimately, you are going to begin with using Google and searching for stock trading systems.  Add to that any systems you may have heard about.  Before you do though, take the time to do some preliminary self analysis.  You may not know what style is best for you yet, but you can surely figure out what is NOT best for you.  That’s a sensible place to start.  You should figure out a few things about yourself first.  Here is a short list you should answer for yourself.  This list will help you eliminate strategies that may not be appropriate for you.

  • How much experience do you have?  If you are a beginner, you probably need to learn the basics of trading first, and then seek out strategies that are simple to learn, and simple to execute, with clear and concise trades indicated in a way that leave no doubt.  However if you are intermediate or advanced, it wouldn’t hurt if the trade strategy you selected did exactly that, as well.
  • How much capital do you have to trade?  If you have less than a $30,000 trade account, then day trading stocks is not for you.  The reason for this is a US regulation called the ‘pattern day trader,’ which states that you must have at least $25,000 to make more than 3 day trades in any straight five day period.  I added another $5,000 (which should probably even be more) because what happens if your first few trades are losses?  This requirement holds true to stock options as well.
  • Most people are going to swing trade stocks (ETFs, options). By figuring this out, you can eliminate many strategies that may not be appropriate to you.  If on the other hand you are adequately capitalized and do plan on day trading, or at least would like to keep that option open, then I would recommend seeking a strategy that is dynamic enough to be able to do both; day trade and swing trade.  In fact, it should be able to do longer term position trading as well.
  • How much time do you have to dedicate to your trading?  If you hold down a full time job, you’ll need to select a slower timeframe like daily charts or even weekly charts.  Swing trading can be made on faster charts as well like 4 hour charts, 1 hour charts and even 15 minute charts.  But are those faster charts practical for you?  Most traders don’t think about what it would be like to manage, day in and day out, a swing trade that uses a 4 hour chart.  It might be profitable, but can you actually execute the plan, over and over again, with discipline and professionalism.  After all, that IS what it takes to succeed.  Most people cannot do this.  Best to think it through now.
  • Other factors that might affect the positive outcome of your trading should also be considered.  The purpose here it an honest assessment of yourself so that you can choose what is NOT appropriate.  That will help you focus on the remaining options.


As I said, once you have answered the key questions above, it will help you eliminate stock trading strategies that are not right for you.  That’s actually a big step.  Cutting through the clutter begins with this process.  Still though, you will be left with many options so in the end, you still need to use common sense when finally deciding to commit to a stock trading strategy.

Common sense should tell you that the companies with the longest track record should be top on your list.  Anyone can package up a stock trading strategy and sell it on line but that doesn’t mean it’s worth the hard disk space it was created on.  Odds are though, that a company with a long term history and track record has a product that is worth considering.  Here are a few things to look for:

  • Does the company have a positive track record?
  • Do they have a lot of positive testimonials?
  • Are the creators of the strategy actual traders themselves?  This is a biggie!  I would want a strategy that someone is already successfully trading.
  • What kind of return policy or satisfaction guarantee do they offer?  The companies with the best track record have nothing to fear and will give you a risk free proposition.  If they don’t, then that should signal the warning signs for you.

You also want to take a close look at the basic principles of the strategy itself.  Here are some important key benefits and features you should be looking for.

  1. Dynamic methodology that self adjusts to market conditions.  This is very important because markets are always changing.  The stocks we were trading in the late 1990’s are not the same stocks of today.  The stock trading strategy you choose should be able to accommodate changing market conditions.  Learn it once, but use it for a lifetime.
  2. Dynamic trade profiles: The actual setup itself should be able to tune itself in live time to give you dynamic entries, targets and stops based on market conditions at the moment of the setup.  This is very important.
  3. Easy rules to follow.  Complicated systems that have too many moving parts lead to a greater risk of either making mistakes or, system failures that occur before you ever realize it.  You’re better off choosing a strategy that simplifies every aspect of trading.
  4. Plan the trade, trade the plan ease of use is what you are after.  The best strategies will print the actual trade setup for you, right on the chart, leaving ZERO doubt as to what the trade is.  Each trade should have precise entries, targets and stops and then a step by step plan of how to actually manage the trade once you are in it.
  5. Ability to use the strategy on various types of charts; daily, weekly, time based, tick charts, range bars, etc..
  6. Customer Support:  You don’t want to buy a strategy where you are then quickly forgotten about.  The best strategies come with coaching and the very best come with actual live trade rooms where you can learn the strategy in real time.


Hopefully, the suggestions offered here will help you make the best decision for you.   I was once a customer and a new trader seeking advice and instruction.  Now I am a professional trader who designs winning trade strategies, hosts a live traderoom and who also who teaches for a trader university,  We are made up of real live traders who know what it’s like to face the lonely challenges of the far right edge of the chart.  There are other good instructional lessons and stock trade courses out there but to really choose what’s best for you, go through the list I have presented above and who knows, maybe the university I teach for will find itself onto your short list of quality prospects.  I wish you every success and hope that you find the stock trading strategy that is best for you.


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