Trading System
Definition
A strategy plus the rules that govern how it is run: position size, a maximum daily loss, what to do in a drawdown, and a journal that records every trade. The strategy decides which trades to take; the system decides how much to risk and when to stop.
Example
“Her system risks 1% per trade and stops for the day after a 2% loss.”
Detailed Explanation
Many traders use the word system for any set of entry rules, but in this library a system is the layer around the strategy. It answers how much, how often and when to stop. A system turns a thin edge into something a trader can survive, because fixed risk per trade and a daily loss limit cap how deep a bad stretch can go. A mechanical system goes one step further and removes discretion from every decision, so two traders following it would take the same trades.
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