New Year’s Resolutions – How to Achieve Your Trading Goals
We are fast approaching the New Year, the traditional time for reflection and goal setting, as we look to improve our health, wealth and happiness. With the best intentions in the world, the unfortunate truth is that most people just don’t manage to stick with their New year’s resolution plans, and often regress into old habits as the year progresses.
Do you intend on setting any goals related to your trading as part of your New year’s resolutions?
Perhaps you would like to to trade with more discipline, keep a more accurate record of your trades via a trade journal, commit to only trading the daily charts, or another similar trading related goal.
A study carried out by renowned psychologist Richard Wiseman – who holds Britain’s sole Professorship in the area of Public Understanding of Psychology – has revealed that over half (52%) of those making New year’s resolutions believed that they could reach their goals. The unfortunate truth is that a mere 12% of them actually succeeded.
With this in mind, the following 5-step list includes some practical elements which may help you achieve your goals over this coming year. This is based on goal setting in general and not just for New Year’s Resolutions.
1.Define long term goals – The first step is to understand exactly what your longer term goals are. This will help shape other elements of the decision making process. Don’t just leave it until New years Eve, start planning now and think carefully about what you want to achieve over the coming weeks, months and years.
If you are not fully clear on what your goal/resolution is yet, but have a general feel for what you want to achieve, you can try a brainstorming session and work around a high level “pre-defined” theme like “How to stick to a trading plan”. Brainstorming is not just a group activity, it can be done on your own and you may produce a wider range of goal based ideas to work from. In this session you should allow ideas to flow freely, withholding any judgement until you review the output at a later stage.
Ultimately, it’s important that you don’t set yourself up for failure with poor planning. As Zig Zaglar once said “A goal well set is halfway reached“.
2. Be specific – Make sure your goals are very specific and important to you as an individual. Don’t just follow the herd and aim for goals that others are making, if they do not resonate with you. What do you really want from your trading and life? A goal stating “I want to be a full time trader” is not really going to cut it in terms of actionable steps unless you drill into the detail.
Chunk any goals down into a series of manageable and achievable steps, with a firm focus on the creation of smaller tasks, leading to the main goal, which are quantifiable and measurable. Carefully plan and lay the foundations for lasting change. In the words of Napoleon Hill “A goal is a dream with a deadline“. Keeping things too high level can make the task at hand seem overwhelming and lead to frustration.
3. Commit your goals to paper or a document on your PC. This could be a simple journal entry or a mind-map document for those who prefer to work in a more visual format. This also helps make your goals more focused and helps refine them. This document will be expanded upon in the next step.
4. Create an action plan. The next step is to create a plan covering the smaller tasks and goals that will help you reach your goals. These should all be based on the specific goal (or New Year’s resolution) you came up with which should now be clearly defined.
You can’t typically just ‘do’ a goal but you can do the things that will help to enable it. There are various ways of doing this; one way is the so called SMART approach (Specific, Measurable, Agreed, Realistic, Time-bound). There are lots of “SMART” template documents to reference if you google for them. If you don’t yet know just how you will achieve the tasks related to your goals keep researching and looking into a realistic action plan that will help you get to where you want to go.
Once you have a plan in your mind you can update the document referenced in the previous step. If you chose a mind map, it should now visually outline the tasks leading to the end goal with the associated sub-branches of larger branches leading to the central theme (goal).
5. Put together a daily/weekly to-do list. Convert the to-do items from the mind map or document into a daily/weekly action plan as required by listing each task and adding a measurable date against each entry. This could be as simple as “review trade journal on Sunday”. You can then schedule each task into your calendar. Google calendar or a similar online tool is ideal as they provide alert functionality to remind you when task is due.
The above may seem like a lot to take on board but the key thing is to detail the realistic and measurable tasks associated with your goals. Here are a few more key points to bear in mind.
- Pay attention to your mind “chatter“. It is vital that we move past any overtly negative feelings and self-sabotaging thoughts relating to our goals.
- Remind yourself of why you are trying to obtain these goals through the creation of a list detailing how life might be better if you achieve them.
- Having a partner, friend or colleague to track and encourage you is something worthy of consideration, even better if they have a similar resolution.
- Be realistic. It’s too easy to get discouraged and give up if the task at hand is not realistic. Start with a small but nonetheless challenging goal and build on your success.