Free educational guide
Trading Psychology Playbook
Recognise common decision biases and use pre-trade, in-trade and post-trade review checklists.
Free access: No payment, account or email signup is required. The guide is educational and does not provide guaranteed returns, trading signals or personalised financial advice.
Separate process from outcome
A profitable trade can result from a poor decision and a losing trade can follow a sound plan. Evaluate whether the setup, size and exit followed the written process rather than judging quality from one outcome.
Common cognitive biases
Confirmation bias favours supporting evidence. Recency bias overweights recent outcomes. Loss aversion can lead to holding losses and closing gains too early. Overconfidence may follow a short winning streak. Sunk-cost thinking treats past loss as a reason to keep risking.
Pre-trade checklist
State the setup in one sentence. Record entry, stop, target and quantity. Identify what would invalidate the idea. Check scheduled events and liquidity. Confirm total open risk. Decide whether the trade still makes sense without the emotional urge to act.
During the trade
Avoid monitoring every tick when the plan uses a longer horizon. Do not widen risk simply to avoid admitting the idea failed. Use alerts and predetermined review points. If new information changes the thesis, document it before changing the order.
Post-trade review
Record planned versus actual execution, emotional state, rule deviations and one improvement. Review groups of trades for repeated patterns. Do not change a strategy after a tiny sample unless there is a clear implementation error.
Environment design
Reduce impulsive access, predefine size, use a checklist and pause after a loss limit. Sleep, stress and distraction affect decisions. This guide is educational and is not a treatment for compulsive trading or gambling-related harm.
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Last reviewed: October 2026. Important tax, retirement and market rules can change; verify consequential information with an appropriate primary source or qualified professional.