Updated from its original posting on 12-31-2011
It’s that time of the year again folks and you know what that means – it’s time to come up with trading resolutions!
As traders, this is a good time to sit back and look back at the year that was. Go through your trading journal and look at each and every one of your trades. (What? You don’t keep a trading journal? Shame on you! At least you have one new resolution for this year!)
Going through this process is an excellent way to find inspiration for setting your resolutions and goals for the new year. As you go through your journal, here are some example questions that you can ask yourself:
- Did I improve as a trader?
- What did I do well? What didn’t I do well?
- What worked for me? What didn’t?
- How well did I do in gauging market sentiment?
- Have I become comfortable with my trading process and framework? Do I need to explore other methods?
List down the things that you need to work on. Be brutally honest with yourself – that’s how you’ll come up with the best resolutions.
If you still need help coming up with some resolutions, here are 5 simple but effective resolutions that you might find applicable to your own trading.
- I will set a daily / weekly / monthly loss limits for my trading account.
- I will stay focused and trade the entire London session from beginning to end.
- I will dedicate 2-hours on Sunday night to prepare my charts and read up on economic reports that will be released in the upcoming week.
- I will be more aggressive and press my winners.
- I will not put off writing and updating my trading journal on a daily basis.
Of course, your list of resolutions will be just a list of meaningless words unless you actually act on fulfilling your goals. As such, we need to establish methods to help you achieve your objectives. You have to follow up and follow through!
One thing you can do to help you accomplish your goals is to re-evaluate yourself on a periodic basis. Have you been sticking to your resolutions? Which of your resolutions are you having difficulty with and how can you improve on them? Take a moment every week, month, or quarter to reassess your progress and get back on track.
It would also help if you had a trading buddy or a mentor to help you follow through. They can nag you, bug you, and give you an objective assessment of your progress. I highly advise this for those of you who have difficulty sticking to resolutions.
There you have it, some tips to help you with your New Year’s resolutions! Keep in mind that it’s never too early to think of what you want to do differently.
That being said, why don’t you share your top trading resolutions below? Who knows, you may be able to borrow a few ideas from your fellow traders!