10 Key Questions on Measuring Your Trading Progress and Success
Dec 07, 2016 04:56
It is human nature to want to know how well you are performing compared to other people. Not only that, you may be wondering if you should continue the path of trading and how your success rate stacks up against others. Here are 10 key questions to ask yourself regarding your trading progress and success.
1.What does trading success mean? Most people define trading success as making more money at trading than you are losing. Of course, it is important to also consider how well you are balancing your trading with your other life activities.
2.What does trading progress mean? Success is not immediate when it comes to trading, but all traders should be making progress in terms of gaining knowledge and developing trading strategies. Even veterans at trading require progress, showing that success and progress are very closely related.
3.Can trading success come quickly? You probably want to know when you should start winning trades. This may happen right at the beginning, but it usually won’t be sustained, even if beginners have a winning streak early on. Success requires perseverance.
4.Is there a timeframe for expecting trading success? There can’t be one answer for this question as each trader trades differently. Some trade full-time, while other may only spend one or two hours a week. Traders should not expect sustained success before a few months, but it can even take a few years.
5.At what point, should I change my trading strategy? Sometimes you may find yourself on a losing streak; however, if you have put effort and time into developing a strategy, don’t be quick to abandon it. You may be able to use the time to tweak your strategy, but abandoning it should be the last resort.
6.How do I know if trading is just not for me? A losing streak is not a good reason to quit. It may be a good idea to quit if you do not have the financial resources for trading or if trading is making you miserable.
7.Should I compare myself to other traders? It is most important to compete against yourself. Establish your own baseline and watch your own progress.
8.Should I discuss my ideas with other people? It can be helpful to have a trading buddy to discuss your ideas and strategies with. A mentor can also help you move forward, but at some point, you will need to become independent and follow your own gut.
9.How do I remain motivated on the way to success? For some people, this is not a struggle as the process is exciting and motivation enough. For others, it is worthwhile to attend trading seminars, speak to veteran traders and read books on a wider range of topics than the technicalities of trading, such as about trading psychology.
10.How can I know if I’m progressing? It is a good idea to plot your progress on a graph so you can clearly see the trend of winning trades vs losing trades.
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