A pre-trade checklist confirms that the minimum conditions in your plan are present before entry. It does not replace analysis; it prevents a fast decision from skipping rules you already decided matter.
Pre-trade checklist
- Correct market: is this instrument allowed by your plan?
- Trading hours: are you inside your permitted window?
- Strategy: can you clearly identify the setup?
- Conditions: are the strategy’s mandatory conditions present?
- Context: is there news, an event or volatility that invalidates the setup?
- Stop and invalidation: do you know where the idea stops making sense?
- Risk: does position size respect your limit?
- Total exposure: do other open positions increase combined risk?
- Target/management: do you know how the trade will be managed?
- Trading state: are you trying to win back a loss, overtrading or breaking an existing limit?
Keep it short enough to use
A forty-point checklist may simply get ignored. Prioritise rules whose violation materially changes trade quality or risk.
Track adherence afterwards
Recording whether each trade passed the checklist lets you compare results between plan-compliant trades and improvised ones. That comparison can be more useful than the isolated outcome of any single trade.
Key idea: a checklist is not there to persuade you to enter. It gives you an objective reason not to trade when a required condition is missing.