Thursday, February 20, 2014

Become the Trader You Already Are

Here is a worthwhile self-coaching exercise:

Keep track of your best trading days or weeks.  Those may or may not be your most profitable periods, but they should be the periods in which you feel you have done your best trading.

Each good day, keep notes on the following:

How you prepared for the day/week:  What was your market preparation?  What research did you conduct or consume?  What did you read?  What conversations did you have, and with whom?  How did you eat?  Sleep?  Exercise?  Prepare yourself mentally?

How you generated your trading ideas:  Where did the ideas come from?  What was the process that led to the ideas?  What made them good ideas?  What gave you "edges" in your trades?

How you expressed your ideas:  What market(s) did you use to express your views?  What instruments?  How did your expressions provide you with superior risk/reward?  If you held multiple positions, how did you size them relative to each other and gauge their correlations?

How you managed your positions:  What kind of trade planning did you do?  How did you size positions and gauge your risk taking?  How did you manage your risk?  What led you to scale into or out of your positions?

How you managed your performance:  How did you review your performance?  What did you learn?  How did you use your learning to improve your future performance?  

Imagine you kept these notes every period you traded well.  Eventually you would have a catalog of your own best practices.  You would come closer to understanding the drivers of your successful performance.

Now imagine that you only kept notes of your trading mistakes and poor trading performances.  What would that reinforce in your mind?  Would such a negative catalog truly inform you of your strengths?

Becoming great means identifying what you are doing greatly right now--and becoming more of the person you already are at your best.

Further Reading:  Becoming Solution-Focused in Your Trading