Beginner’s Course: Trade Planning and Risk Management
Course Overview
Learning how to plan trades and manage risk is essential for anyone starting their trading journey. This beginner-friendly course shows you exactly how to plan trades and manage risk using structured planning, practical tools, and different trading styles. You’ll learn how to build a solid trading plan, choose the right style for your goals, and apply smart techniques to protect your capital. With simple lessons and a short quiz, this course helps new traders build confidence and consistency.
- Short, digestible lessons
- Realistic examples and charts
- Interactive tips and risk tools
- 8 beginner-friendly lessons
- End-of-course quiz (10 questions)
Why Trade Planning and Risk Management Matter
Understanding trade planning and risk management is crucial to long-term success. With a plan, you avoid impulsive decisions; with risk management, you avoid catastrophic losses. This course breaks both concepts down into simple, actionable lessons.
Course Content
- What is a Trading Plan? (7 min)
- Steps to Building Your Trading Plan (10 min)
- Understanding Risk in Trading (6 min)
- Key Risk Management Tools (Part 1) (7 min)
- Advanced Risk Control Methods (Part 2) (7 min)
- Exploring Different Trading Styles (3 min)
- Position and Swing Trading Explained (10 min)
- Scalping and Day Trading Techniques (10 min)
Lesson 1: What is a Trading Plan?
A trading plan is a set of rules and guidelines that define how you’ll enter, manage, and exit trades. It removes emotional decision-making and keeps you focused on long-term consistency. This lesson explains the benefits of structured planning and how it can improve discipline and performance over time.
Lesson 2: Steps to Building Your Trading Plan
This lesson covers the core components of a personalised trading plan. You’ll learn how to define your trading goals using the SMART framework (Specific, Measurable, Attainable, Relevant, Time-bound), choose suitable markets and timeframes, and document your entry and exit criteria. A downloadable template is included.
Lesson 3: Understanding Risk in Trading
Risk is an unavoidable part of trading. This lesson explains common trading risks such as market volatility, overleveraging, and emotional decision-making. You’ll learn to assess your risk appetite and how to calculate your maximum acceptable loss per trade.
Lesson 4: Key Risk Management Tools (Part 1)
Here we introduce basic tools like stop-loss orders, take-profit levels, and risk-reward ratios. You’ll learn how to set appropriate levels for each trade and how these tools can protect your capital from large losses.
Lesson 5: Advanced Risk Control Methods (Part 2)
This section goes deeper into concepts such as portfolio diversification, position sizing strategies (like fixed fractional or Kelly Criterion), and adapting your plan based on market conditions. Practical examples illustrate when and how to apply each method.
Lesson 6: Exploring Different Trading Styles
Every trader has a different temperament and schedule. This short lesson introduces four main trading styles—position trading, swing trading, day trading, and scalping—highlighting their pros, cons, and suitability for different trader profiles.
Lesson 7: Position and Swing Trading Explained
This lesson explores the medium- to long-term strategies of position and swing trading. You’ll learn how traders use trend-following systems, technical patterns, and macroeconomic events to identify opportunities that may unfold over days or weeks.
Lesson 8: Scalping and Day Trading Techniques
Scalping and day trading require speed and discipline. This final lesson explores short-term strategies, including momentum trading and breakout setups. Risk control and quick decision-making are essential, and we’ll look at tools traders use to stay agile.
Example Lesson Extract: Setting SMART Trading Goals
Before placing your first trade, it’s crucial to know what you want to achieve. SMART goals can guide your progress:
- Specific: Define your goal clearly, e.g., “Earn 3% monthly return.”
- Measurable: Use metrics to track success.
- Attainable: Be realistic—don’t expect to double your money overnight.
- Relevant: Align goals with your long-term financial plan.
- Time-bound: Set deadlines to review or adjust your plan.
Test Your Trade Planning and Risk Management Knowledge
Time: 5 minutes | Questions: 10 | Format: Multiple choice
Once you complete all 8 lessons, take this short quiz to test your understanding. Questions cover trading plans, risk control tools, and trading styles. It’s not about getting every answer right—it’s about reviewing your knowledge and identifying areas for improvement.
Sample Question:
What is the primary purpose of a stop-loss order?
- To lock in profits at a specific price
- To limit potential losses by closing a trade at a predefined level
- To automatically reinvest profits
- To double position size when in profit