Rules — Checklists You Actually Follow

Rules are the bridge between intention and execution. Most traders know their rules before the open and break them by 10:45. The Rules pillar turns limits into checklists and scores you can plot weekly — max loss in rupees, max trades, allowed setups, stop discipline. Without logged rule breaks, insights and AI summaries cannot tell you whether edge or discipline failed.

Pre-trade checklist vs post-hoc excuses

Write your checklist when calm — not after a loss. Example intraday checklist for NSE cash: (1) Is this an A+ setup on my watchlist? (2) Is rupee risk ≤ ₹X and ≤ 1% of book? (3) Have I already taken my max three trades today? (4) Is spread and liquidity acceptable? Tick yes/no before order submission. A failed check means no trade — not a smaller trade “just to try.”

Capital limits in rupees

Percent rules are abstract until converted to rupees. On a ₹5 lakh book, 1% daily max loss is ₹5,000 — write that on your pre-market note. Hit ₹5,000 realized loss, close the terminal. Options traders: include premium paid and assignment risk in the same daily cap, not just marked P&L on screen.

Discipline score and rule-break log

End each session with a discipline score 1–5. Log explicit rule breaks: moved stop, doubled size, traded banned symbol, held into illiquid close. Over a month, count breaks per rule type. If “chased entry” appears eight times and “oversized” appears twice, your fix is execution patience — not a new indicator.

Example: revenge sequence after two losses

You lose ₹1,800 on two valid Bank Nifty trades that respected stops. Rule three says stop for the day. You take a third trade double size without a checklist tick — lose ₹4,200. The journal must record rule break type “size after daily stop” separately from setup quality. Otherwise monthly review blames the strategy instead of the violation.

Position sizing tied to rules

Size is a rule, not a feeling. Define lots or quantity as function of stop distance and rupee risk. On Nifty futures, if stop is 25 points and ₹500 per point per lot, a ₹2,500 risk budget allows one lot — not two because you are confident. Link position-sizing calculator output to your checklist as a hard number.

Rules mentors can audit

If you work with a mentor, share rule definitions in writing and log breaks they can see. Mentors cannot help if you only export P&L. Permissioned journal access in TradeLyser lets them review checklist adherence without WhatsApp screenshots.

When to tighten vs loosen rules

• Tighten after two rule-break weeks in a row — shrink size or reduce max trades.
• Loosen only after twenty compliant sessions and stable expectancy — not after one lucky expiry.
• Never loosen daily loss limit because you “feel better” — change setup filter instead.
• Re-read rules every month; markets change, your checklist should too.

Session-specific rules for NSE traders

Write rules that match Indian session realities: no new positions in last fifteen minutes unless your playbook explicitly includes close auctions; half size on monthly F&O expiry; no trading first five minutes until you have twenty logged trades proving edge on open drives. Circuit-hit stocks and illiquid small caps belong on a banned list — chasing them after upper circuit is a rule break, not a strategy.

Carry overnight only if your plan lists hold rules — margin shortfall and gap risk on NSE open are not surprises if they were in the checklist. Options sellers should include max premium at risk per day in rupees, not only max loss on screen.

Rule system mistakes

• Too many rules — if checklist exceeds seven items, you will skip it under pressure.
• Rules only in your head — they must live in the journal or TradeLyser trade plan.
• Punishing size cuts without identifying which rule broke most often.
• Treating green P&L as proof rules are optional.
• Changing max daily loss mid-session after two losses.

Weekly rule review prompt

Every Friday, list the top rule break type by count and rupee cost. Pick one fix for next week: earlier hard stop on the day, smaller default lot, or banned setup after 14:30. If breaks are zero but P&L is red, your rules are working — review strategy quality in Insights instead of loosening limits.

Start with three non-negotiable rules

New traders drown in twenty rules. Start with three you will log every session: (1) max daily loss in rupees, (2) max trades per day, (3) allowed setup list only. Add a fourth rule only after twenty sessions with fewer than two breaks on the first three. Example starter set on a ₹3 lakh book: ₹3,000 daily stop, three trades max, only watchlist A+ breakouts on Nifty or top five liquid stocks. Everything else — no averaging down, no options on expiry — can wait until the habit sticks.

Worked example: checklist before a Reliance trade

Reliance pulls back to VWAP at 10:20. Checklist: A+ setup yes, rupee risk ₹1,200 on ₹50 stop with quantity 24 shares yes, two trades taken today yes (third allowed), spread normal yes. All yes — submit limit order. If you are at max trades, the checklist fails even if the chart is perfect. Log “skipped — max trades” as a win in discipline terms; that row protects you on revenge hour.

Rules inside TradeLyser

Store rule definitions in your trade plan or pinned pre-market template so they are visible before 9:15. Use discipline and rule-break fields on each trade — generic “bad day” notes do not sort in reports. Pair daily rupee cap with a widget or alert on realised loss if your workflow supports it; visual cap beats mental math at 14:45. Review rule-break counts in the same Friday session as expectancy — split process failure from edge failure before you touch strategy tags.