What’s Your New Year’s Trading Resolution?
For many, a New Year provokes reflection on the previous year and motivation to make the upcoming year better than the last by setting resolutions. This applies to all area of our lives. For us traders, these thoughts will be focused on our profit and loss, our good trades and our bad trades. This is the perfect time to analyse your trading results from 2017 and strive for improvement – get on the ‘new year, new me’ bandwagon!
The success rate for sticking to New Year’s resolutions is fairly low. Although we have the best intentions at heart, it can be hard to maintain enough motivation throughout the year to adhere to our resolutions. With that in mind, instead of focusing on trading ‘resolutions’, let’s focus on trading goals. It is proven that setting goals can increase your productivity. An increase in productivity could mean an increase in profit! Even the most profitable traders will be setting themselves trading goals and this is exactly why they are so successful. Following a good routine, process or system and setting goals are what all of the most successful people in the world all have in common. With that in mind, you might want to consider the following questions to analyse your 2017 trades and to make 2018 your best trading year yet!
How many winning trades did you have?
How many losing trades did you have?
Did you meet your profit target?
Where can you improve?
What steps can you take to make these improvements?
Is your trading strategy and system working for you?
Is your trading plan working for you?
What are your goals for 2018?
Professional trader and mentor Lee Sandford shares his New Year’s trading goals for the year ahead and what he hopes to achieve by the end of 2018.
Lee, what’s your trading goal for 2018?
First things first, I won’t be changing my Friday golf days! I’ll still be having one day a week to play golf and reward myself. In relation to trading, as ever, my goal is to make my day’s money in the morning as soon as possible. And my reward for achieving this is that I spend my Fridays away from the charts and focusing on my hobby, golf. Being tied to the screens all day, every day isn’t healthy for anyone. As traders, we know it can actually be counterproductive. It’s about quality, not quantity. Every year, you are always trying to develop as a trader. This year, in particular, I will be working on getting even better and using more targeted and precise entry positions. For me, this means more practicing and focusing on my technique.
What were some of your challenges in 2017?
Last year was a year of growth for Trading College with more and more students coming onboard. This brought the challenge of trying to manage my teaching and mentoring along with trading my own account. This year, I’m focusing on personally teaching a select few students. That way, I can concentrate more on growing my trading account.
Are you going to change your trading plan?
I don’t need to change my trading plan because it works for me. You should always be looking to make your strategies and systems better. However, why would I want to change them if they have made me money time and time again? If you’re making money consistently, you don’t really want to change what you’re doing. If you’re not making money, then you must realise it’s not always the system or the strategy that is the problem. There are so many other things it can be. How much practice have you had using your demo account? Practice in your demo account and trade the strategy that is going to make you consistent profits. Practice so much that it is ingrained in your conscious mind. When you see the signal to take the trade, don’t hesitate to pull the trigger and enter.
What areas can traders develop to better their trading?
Working on self-development, mindset and practicing continuously is what will improve your skills as a trader. Strategies and systems are once again, just a small part of it. Like my philosophy in life, it’s all about trying to improve whether it’s trading or playing golf!
Here is my advice… if you’re somebody that didn’t make money in 2017, make sure you have a good trading system and get good at following the system or strategy. That’s the secret of trading success. Some people have a great trading system but are awful at following it and don’t follow the rules. 2018 should be about following the rules and really doing it well because you’ll see that something magical happens when you start to follow the system and the rules of your strategy. As long as you have good money management procedures in place, you should make money and grow your trading account. So remember to work on the process of entry and following your system’s signal.
Other areas you could choose to improve on include risk management, mindset or practicing in a demo account and getting feedback. Many people don’t practice enough in a demo account and when they go into a live trading environment, it’s like walking into the lion’s den! They haven’t spent enough time practicing and getting enough feedback from their peers or mentors. You need to get your mind in tune into what happens in live markets when it really matters. While you are learning to trade, spend more time at your screens and practice, practice, practice!
What are some common mistakes that traders make?
You may think you’re alone if you’re not making money but every single trader has made the same mistakes. Some of these include exiting profitable trades too early or getting the position size wrong, for example, instead of £1 a point, you might go in at £10 a point. Others might over trade or overcomplicate the process or even over analyse – all of these have been done before in the past.
What is your advice to traders when making their 2018 goals?
The first thing you really want to ask yourself is, do you really want to change? Are you serious about trading and making it a success? Once you’ve answered that, and your answer is ‘yes’, then you need to put a plan together which will include rectifying the challenges you have. You will need to know and accept that you are experiencing these challenges and making mistakes, and put a plan together and then you’ve got to know what to do to improve your skill level as a trader.
If you’re not getting feedback or accepting feedback either from yourself or our mentor, then you cannot expect to improve or make more money. Some people like to go at this alone but I would get advice from an experienced coach or mentor. The reason being, some people make the same mistakes over and over again and seem to find it very hard to change their behaviour(s). Don’t be frightened to get help, otherwise, it’s all going to end very badly again!