Forget the scoreboard

You are not your score board. As traders our scoreboard is the balance and equity are our scoreboard, and it doesn’t lie. It’s either going up, down or staying the same. While profit and losses are a great measure of profitability. They are a terrible measure of progress or lack thereof. If you measure your progress by whether or not your last trade was profitable or not.

This end goal oriented approach for measuring progress is flawed for one simple reason. When it comes to the outcome of any random trade you have zero control of whether the trade ends up profitable or not. Randomness and luck get to play that role. We have to measure our progress and the area of focus should be on what we do, not how we are doing at least on a trade by trade basis. In fact it actually doesn’t matter how the results of a trade turn out as. What matters is if we executed our plan. We need to observe and analyse results with detachment and nonjudgement. Learn what needs to be learned if any and move on. The result of the trade doesn’t tick your progress scale one way or the other. They certainly don’t define you either. You are not your results.

Your long term goal about the money you desire should only serve as a router. Guiding you along the way. Our main focus and goal should be the process of getting there.

Let’s say you have a reasonable goal of making a R1 million from trading in 5 years. Once you have that goal in mind. Use some imagination for a second and pretend it’s now 5 years later and now you’ve made your million. Ask yourself how you make that million. What did you do or not do, how did you grow your account, what was your approach, how did you handle risk management, try to throw in as much detail as you can. It’s okay to make some stuff up after all that’s what imagination is. It’s also okay if you don’t know how to get or do some of the stuff you write down.

Then look at the things you do, and pick the ones that you can achieve, the smaller the better. That with the resources and knowledge you have right now you can achieve, and make those your goal. If you do these things as your goal. Work toward just achieving those “small” things on the list. Make those your goal, because you know these are the things that bring me closer to my longer term goal. Most importantly, it helps build up the momentum and the feeling of winning and moving forward. It also puts your progress well within your control. You keep getting the positive feedback loop from achieving.

If we instead just look at the million is the only goal. If it takes 5 years to get there. We are going to spend 5 years without achieving any goal. For every second your account is not a million rands you haven’t achieved a goal. Another question comes, after 5 years and a million then what?

Once you have your goal, shelve it, start the process of getting closer toward it, trust yourself, your abilities and go for it with unconditional confidence and an unshaken belief.

Remember things change when you change

Leave a Comment

Your email address will not be published.