Philosophy

Low Cost

As with all investing one of the key drivers of long-term trading performance is keeping expenses low.  This is as true in this endeavor as in any other business.  Futures trading is extremely inexpensive in terms of commissions. Even for just a few contracts you can pay as little as $3 round trip per contract.  This compares favorably with stock trading.  There is also no management fee to holding an asset for any length of time

Simple Strategy

A trading strategy should be simple enough for the non-professional to implement.  It is like a light switch; you don’t need to know all the intricacies of the power grid that stands behind it, only when to turn the switch off and on.  This plan tells you exactly when to make a move and does so in plain language.

Rule Based

The temptation to play “hunches” and follow your gut is a sure path to subpar trading returns.  Successful traders have a rule or set of rules that guide their trading actions.  The heat of the moment is no time to formulate strategy.  Choose a strategy that makes sense; look at the back testing, then follow the rule.  Rules based trading removes much of the emotions that can ruin a trading plan.

Emotionally Attainable

This is key.  All of the previous three pillars are for naught if the plan is not emotionally attainable.  By this we mean that a plan that expects you to completely ride out gut wrenching downdrafts is simply not realistic.  Most traders bail out during large, yet short-term drops, locking in substantial losses.  Traders have a long well-documented history of bailing too soon as well as staying in too long due to emotional distress.  The Cake Futures Trading Plan is crafted in such a manner that you will be safely on the sidelines with either solid profits or acceptable losses that do not remove you entirely from the game.

Let us now turn to the actual methodology of The Cake Futures Trading Plan.

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