Tag Archives: Growth

Slow, Steady, Incremental Progress

 

Excerpt from an email from J.L.

  • Finally, do you have any articles that could be helpful going from sim to live?

 

Let's write one now…

Do NOT rush.

The markets will always be there, ready and waiting for when YOU are ready.

The journey takes as long as it takes. And the psychological challenge is different at each level of risk.

So aim for slow, steady, incremental progress.

Let's break the journey into stages, noting that this is for discretionary traders. Systems traders will use a different process.

 

Stage 1 – Historical Chart Study

Stage 1 involves study of past data in order to achieve the following two aims:

  • Understanding the strategy – HOW to trade it and WHY it should work.
  • Confirming potential for edge through study of historical chart sequences.

 

This stage takes as long as you need it to take, until the point at which you you understand the strategy and believe it has potential for edge.

The key word above is "potential". Any edge you perceive through historical study is only a potential edge. It needs to be proven at the hard right-hand side of the screen, with real-time data. This will be done in the following stages. For now – just confirm that all evidence appears to show edge.

The more thorough your work at this stage, the greater the likelihood that you'll not be wasting your time in the following stages with a strategy that does not offer any real long-term sustainable edge.

 

Stage 2 – Simulation – Proving Edge

Stage 2 involves operating the strategy in a simulated environment in order to confirm the edge is real.

Some people are tempted to skip this stage, through concern that a simulated environment does not offer the same psychological challenge of a live environment. But that is exactly the reason why you should start on the sim – keep it simpler. Why risk actual funds when the edge is not yet proven. Take the time to prove the edge in the simpler and safer environment, without this higher degree of psychological challenge. Then, once proven, you can advance to the live environment with a greater degree of confidence in the strategy and your ability to trade it.

Slow and steady!

Incremental progress!

We will be analysing our trade performance in groups of trades. So you need to start by determining a suitable group size for analysis of stats, ensuring that groups will contain no less than twenty trades. It doesn't really matter whether your groups contain a variable number of trades (perhaps weekly groups, or daily for more active traders who complete dozens per day), or whether your groups contain a fixed number of trades (20 or 50 or 100 trades). Pick something that makes sense for your frequency of trading. Just ensure it's no less than 20 trades. And be consistent.

Trade a complete group, recording your individual trade results in your Trading Journal Spreadsheet. While trading a group your concern is not profitability but rather consistency of process and quality of execution. Your trading should be carried out with minimum size, simulating the EXACT processes you will follow when you first transition to the live environment.

Only when the whole group is complete should you concern yourself with performance. Analyse the stats for the group, in particular the win percentage and win/loss size ratio. Confirm whether you have proven edge across this sample of trades.

If edge is not proven, determine which group statistic is underperforming. And then study the component trades to identify (a) one potential cause of this underperformance, and (b) a plan to improve performance over the next group. Now document the changes and start again with the next group.

If edge is proven, congratulations. Now do it again.

Repeat the process until you can prove edge in terms of profitability and consistency, maybe five times in a row. Only then should you consider transitioning to a live environment.

 

Stage 3 – Live Environment – Proving Edge

Stage 3 takes you live, with the ABSOLUTE MINIMUM exposure to risk that your strategy and your market allows. That is, the smallest position sizes possible.

The aim is to trade in exactly the same manner as just carried out in the simulated environment. The only change should be live execution and the additional psychological challenge of having money at risk.

Be completely clear regarding your maximum acceptable drawdown during this stage. And commit to dropping back to the sim again, should this limit be hit.

Slow and steady!

Incremental progress!

Performance will again be assessed in groups of trades, using the same group size as when sim trading.

Trade a complete group, recording your individual trade results in your Trading Journal Spreadsheet. While trading a group your concern is not profitability but rather consistency of process and quality of execution.

Only when the whole group is complete should you concern yourself with performance. Analyse the stats for the group, in particular the win percentage and win/loss size ratio. Confirm whether you have proven edge across this sample of trades.

If edge is not proven, determine which group statistic is underperforming. And then study the component trades to identify (a) one potential cause of this underperformance, and (b) a plan to improve performance over the next group. Now document the changes and start again with the next group. If performance is completely unacceptable then consider dropping back to the sim.

If edge is proven, congratulations. Now do it again.

Repeat the process until you can prove edge in terms of profitability and consistency, maybe five times in a row. Only then should you consider increasing risk.

 

Stage 4 – Live Environment – Improving Edge

Stage 4 is a never-ending process of stretching yourself to new levels of performance.

Identify the change you wish to make, ensuring that it is in ONE PART of the process.

The obvious example here is an increase in size. Make it a small and incremental increase.

But this may also be any changes to process. Keep it small and incremental. One change at a time.

Performance will again be assessed in groups of trades, using the same group size as in previous stages.

Trade a complete group, recording your individual trade results in your Trading Journal Spreadsheet. While trading a group your concern is not profitability but rather consistency of process and quality of execution.

Only when the whole group is complete should you concern yourself with performance. Analyse the stats for the group, in particular the win percentage and win/loss size ratio. Confirm whether you have proven edge across this sample of trades.

If edge is not proven, determine which group statistic is underperforming. And then study the component trades to identify (a) one potential cause of this underperformance, and (b) a plan to improve performance over the next group. Now document the changes and start again with the next group. If performance is completely unacceptable then consider rolling back the changes in order to return to something that was working, before again attempting change at some point in the future.

If edge is proven, congratulations. Now do it again.

Slow and steady!

Incremental progress!

Two final points here.

Firstly you should never completely trust an edge. Maintain constant vigilance. Continue to monitor the stats for your groups of trades, in order to confirm not just profitability but also some degree of consistency from group to group.

And secondly, if you're not growing as a trader, then the problem is that your review processes are not driving any growth. Fix your review processes.

<image: If you are not growing as a trader, this is the problem...>

Best of luck with your journey.

Remember, there is no hurry.

Slow and steady!

Incremental progress!

Lance Beggs

 


 

What if you Narrowed Your Focus?

 

For those day traders who might be stuck in a cycle of continual failure… what if you narrowed your focus?

<image: What if you narrowed your focus?>

<image: What if you narrowed your focus?>

<image: What if you narrowed your focus?>

Some days there might be no opportunity. That's fine.

Other days there might only be one trade opportunity. Again that is fine.

The idea is that this is not necessarily a permanent change to your trading.

It's simply a narrowing of focus to ONE key segment of the trading session.

Master this one key segment – the opening hour.

Prove you have edge in managing the opening sequences of your trading session.

And only then expand to further opportunity.

Let's look at another session:

<image: What if you narrowed your focus?>

<image: What if you narrowed your focus?>

<image: What if you narrowed your focus?>

And again:

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<image: What if you narrowed your focus?>

<image: What if you narrowed your focus?>

For those who trade differently, whether through higher timeframes or multiple markets or in fact any other difference, see if you can adapt the same general concept to your own trading.

Narrow your focus. Build expertise and prove edge in ONE key sequence at a time, or ONE market at a time, or ONE A+ setup type. Whatever works for you.

Narrow your focus.

And fight to get off that cycle of continual failure.

Best of luck,

Lance Beggs

 


 

30 Days to Becoming a Better Trader

 

Before departing on holidays recently I preloaded Facebook and Twitter with 30 posts to help improve your trading business.

And it seems that people loved them. I had a few requests to put them all together in one group.

So here they are. (Also in PDF form here if you prefer – http://www.yourtradingcoach.com/products/ebooks/30-days-to-becoming-a-better-trader.pdf)

They're all quite simple. Just 30 questions to get you thinking about your trading business. If something catches your attention, explore the idea deeper. It might lead nowhere. But it might also lead to improvements in process or even new sources of edge.

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Happy trading,

Lance Beggs

 


 

Never Stop Experimenting

 

Growth never stops.

Schedule some time to play. To experiment. To explore.

Often it will lead nowhere.

But sometimes it might create new insights which transform your trading and your life.

Persistent thought 1: "Is there any reason why I have to wait till 0930ET (12:30am my time)? When "life" allows, why don't I trade the currencies from 0800 to 0930 and then shift across to my normal market?"

Persistent thought 2: "I really need to explore the idea of scaling in – spreading an entry across a zone rather than going all-in."

If you're like me you'll find thoughts and ideas repeatedly competing for your attention.

Don't discard them. Their might be gold in those ideas.

But don't let them distract you from your main job of trading your current defined strategy.

Schedule some time outside of normal work hours for play and experimentation.

You never know what you'll discover.

<image: Never Stop Experimenting>

<image: Never Stop Experimenting>

<image: Never Stop Experimenting>

<image: Never Stop Experimenting>

<image: Never Stop Experimenting>

Persistent thought 1: "Is there any reason why I have to wait till 0930ET (12:30am my time)? When "life" allows, why don't I trade the currencies from 0800 to 0930 and then shift across to my normal market?"

I enjoyed this. It's been quite a long time since my last play with currencies.

And while life doesn't usually allow me to be ready for trading by 11pm, I see absolutely no reason why I shouldn't consider trading the currencies on those odd occasions when it does. It certainly beats sitting and waiting for another hour and a half.

Persistent thought 2: "I really need to explore the idea of scaling in – spreading an entry across a zone rather than going all-in."

I've tried this several times in the past, but always abandoned it. It's clear my strength is precision entries, all-in, with imperfection managed through scratching and re-entering as required.

And yet the idea keeps persisting. I will likely play with this more, as time allows. But I have to make sure that when I feel the trade tipping in my favour, I've got to get full size on.

In any case… today's goal of simply experimenting in the hour and a half prior to the US emini open… was a resounding success.

If you're like me you'll find thoughts and ideas repeatedly competing for your attention.

Don't discard them. Their might be gold in those ideas.

But don't let them distract you from your main job of trading your current defined strategy.

Schedule some time outside of normal work hours for play and experimentation.

You never know what you'll discover.

Happy trading,

Lance Beggs

 


 

How to Kick-Start Your Growth and Development

 

If your progress has stalled in any way, it is just SO IMPORTANT to realise the following truth:

Progress comes from your growth and development plan, not from your strategy.

This just won't work:

The typical failed process

Hoping, wishing and praying doesn't work.

Just trying harder doesn't work.

You need something ACTIONABLE.

Let's fix it NOW:

STEP ONE: Implement a growth and development plan based upon GROUPS OF TRADES.

Here is the concept. Review the following articles:

(a)  http://yourtradingcoach.com/trading-business/its-time-to-fight-to-get-to-the-next-level/ 

(b)  http://yourtradingcoach.com/trading-business/its-time-to-fight-to-get-to-the-next-level-examples/

(c)  http://yourtradingcoach.com/trading-business/you-can-do-this/

(d)  http://yourtradingcoach.com/trading-business/consistency-its-a-necessary-part-of-the-process/

(e)  http://yourtradingcoach.com/trading-business/before-making-changes-to-your-strategy/

A GROUP OF TRADES Growth and Development Process

Also… any changes you're making…  consider making them the stretch goal for your next group.

See here – http://yourtradingcoach.com/trading-business/stretching-to-the-next-level/

A stretch goal - just a little stretch beyond current capabilities

Most importantly, major process changes can only occur at the end of each group. And they must be based upon proper review and analysis of your group stats and journal entries.

STEP TWO: Intra-group, monitor daily to ensure consistent implementation of your process.

No major process changes occur here.

Only tweaks or minor changes to how you execute your processes.

A daily review to improve implementation of your processes

Now move the response to question three to tomorrow's pre-session planning.

Remember:

Progress comes from your growth and development plan, not from your strategy.

If you're not progressing, then something HAS TO CHANGE.

Something actionable.

Something concrete.

Between groups, you MUST identify a concrete, actionable improvement to process.

Within groups, you MUST monitor consistency in implementing process, and tweak as required to improve implementation.

Hoping, wishing and praying that somehow this time it will be different, doesn't work.

Just trying harder, doesn't work.

Find something REAL that you can implement.

It won't always be easy. In fact it will rarely be easy. But damn it, you can't progress by just continuing on the same treadmill.

Fight to find an actionable change that progresses you in the right direction. Implement it. Repeat.

You can do this, 

Lance Beggs

 


 

Employing a Self-Distancing Strategy to Improve Journaling and Review

 

Close your eyes and imagine a really bad trading session. You might have a recent example you can use. Or if not, just make one up.

The details don't matter. They'll vary for each of us. Just make it bad.

Maybe this:

"I drag myself into the office and throw my bag on the floor. Feeling crap with a hangover and too little sleep due to last night's celebrations. It's 10 minutes till market open. No problems. I'll catch up on the pre-session admin later and just wing it. I'm on my third coffee already – this should help me make it through ok."

The market opens and drives higher with strength. "Suckers… it's right into resistance. I'll short here and catch the move back down to the market open."

Of course, it loses!

As does the second attempt. And the third. And the fourth, which had the stop pulled even higher, because "this damn thing is so overbought".

Or maybe your example is something much worse.

Whatever it is, close your eyes and visualise it. And feel every feeling that such a session would bring.

Disgust! Anger! Frustration!

Now, the session is over. You've smashed your keyboard and it's time for review. Close your eyes and imagine yourself critiquing your performance.

SERIOUSLY!

Close your eyes, visualise this scenario. And then critique your performance.

Now let's shift the scenario slightly.

This time the session went exactly the same, but you weren't the trader. The trader was the person you most love in life. Your partner. Your Mum. Whoever you care the most for.

And you're their coach. The person they come to after each session to discuss their performance and to plan the way forward.

Close your eyes and imagine how you would handle their performance review.

Visualise it.

Feel it.

If you've been honest with yourself, it's likely that the first scenario would have been far more emotional. Quite likely an explosive, self-critical and self-deprecating review.

Whereas the second, while still noting that the performance was unacceptable and must lead to change, would likely be more calm and rational. With a more considered review of both the reasons for the poor performance and the solution that is necessary to prevent recurrence.

This simple shift in the scenario has created some space, or distance, between our rational mind and the emotion associated with the trade performance.

 

Self-Distancing Strategies

I absolutely love this article by Brad Stulberg in NYMag.com:

http://nymag.com/scienceofus/2017/02/self-distancing-will-help-you-make-smarter-deciions.html

Please read it. It will take about 10 minutes, tops.

Some key excerpts:

  • Collectively referred to as “self-distancing,” practices like those outlined above and Rusch’s “pretend you’re talking to a friend” allow us to remove our emotional selves from intense situations, paving the way for more thoughtful insight and subsequent decision-making.
  • Employing a self-distancing strategy allows you to evaluate activities or situations that are rife with passion from an entirely different perspective, one that includes logic alongside emotion.
  • “I talk to myself all the time,” says Rusch. “It’s just that when I talk to myself as myself, I tend to be negative and not so helpful. But when I talk to myself as if I were talking to a friend, my words are motivating, forgiving, and far more productive.”

 

Employing Self-Distancing Strategies to Improve Journaling and Review

I will be employing these ideas in two ways:

(1) Journaling

Here's another excerpt from the article:

  • Similar studies show that when individuals think, or journal, in the third person rather than in first person — for example, “John is running into challenges with his business that seem insurmountable” versus “I am running into challenges with my business that seem insurmountable” —they, too, evaluate themselves and their situations more clearly and with more wisdom.

 

I now journal in the third person.

Give it a try for a month. You can always go back to normal if you don't like it.

(2) Reviews

All reviews (session reviews and longer term reviews) will now be conducted as if I am the "Performance Coach" reviewing a trader within my firm.

Again, give it a try for a month. You've got nothing to lose.

And if you can separate your rational and logical side from the emotion of the session, just a little, there is a WHOLE LOT to potentially gain.

 

Why Not Get Started Right Now?

That trading you did so far this year is no longer yours. It was done by your best friend, your partner, or some other loved one.

You are now the performance coach.

And it's time for you to honestly review their trading business.

Close your eyes and imagine the review session. And answer the following questions.

  1. Did they approach these recent months with clear and realistic goals for growth and development?
  2. Did their performance drive them successfully towards achievement of their goals?
  3. Are the goals still appropriate, or do they need amending?
  4. What action must be taken in the coming months to take decisive steps forward?

 

Calmer. More rational. More logical.

And far more likely to lead to practical and effective decision making.

Give it a try!

Happy trading,

Lance Beggs

 


 

Before Making Changes to your Strategy, Ask These Questions…

 

We're one week into the new year. Are you already trying to tweak your strategy, or your trading process, based upon a bad session or two?

Before making changes to your strategy or process, ask yourself the following questions:

1. Is the change the result of deliberate analysis of past performance, in order to improve upon a recognised deficiency or to further enhance a current strength?

A Deliberate Process

2. Or is the change a result of looking at a few different indicators or settings and thinking, "This might be a good idea"?

I know it will work this time!

It better be the first one!

If not, the major problem is not with strategy, but with your growth and development process. Yes, the strategy may well need further work. But without an effective growth and development process you'll likely never find the right solution.

Let's fix it now.

First, review this article – http://yourtradingcoach.com/trading-business/dont-break-the-chain-a-simple-tool-to-improve-consistency/

We're going to use this method to try to force some consistency. But with a tracking sheet designed just for this purpose.

Right click to save a PDF copy

(Larger copy: http://www.yourtradingcoach.com/products/ebooks/consistency-tracker.pdf)

And second, commit to a better process.

Review this article – http://yourtradingcoach.com/trading-business/its-time-to-fight-to-get-to-the-next-level/

Print out the article if necessary.

And take action.

A Deliberate Process

Your trading success requires consistency in application of your plan… and an effective process for driving growth and development.

You can do it!

Happy trading,

Lance Beggs

 


 

Stretching to the Next Level – Followup

 

Let me start by sending out a massive THANK YOU to the whole YTC community.

I believe last week's article set a new record for the amount of feedback it received.

And all positive, which is nice to see!  🙂

Check it out here if you missed it – http://yourtradingcoach.com/trading-business/stretching-to-the-next-level/

The aim of the article was to have you bring your goals closer.

Closer in time. And just a small stretch above and beyond your current capabilities.

This ensures that you receive quicker feedback. And most importantly, that you have a greater chance of achieving the goal.

Small wins, received often, do wonders for your mindset and self-belief.

Plus… it's just the way that progress works. So many things in life are achieved through small, incremental steps. For some reason we tend to forget that when it comes to trading.

I was most excited mid-week to see a new blog post by Dr Brett Steenbarger, which ties in nicely with our "stretch goals". Dr Steenbarger has for a long time been one of my favourite trading educators. His writing is of the highest quality. Every blog post is something I never miss.

I recommend reading the post in full here – http://traderfeed.blogspot.com.au/2016/12/how-to-trade-with-peace-of-mind.html

But the key points, as they relate to our article last week are:

  • "…the way in which we set goals greatly impacts the probability of our success and the mindset we're likely to come away with."

  •  "…the importance of keeping goal-setting flexible and doable. Flexible means revising goals at intervals: for example, setting monthly goals rather than annual ones. Doable means that both the number of goals and their difficulty be set in such a way as to set us up for success rather than frustration. Many big goals can be broken down into a sequence of smaller ones that create an ongoing sense of progress and momentum."

  • "Over time, the accumulation of small goals creates large changes. The idea is to make each day a win, regardless of the P/L of the moment. That creates peace of mind, and peace of mind frees us up to trade with open minds."

I'd like to also share with you an extra step to the "stretch goals" which I shared with a couple of traders via email last weekend.

It's the idea of having TWO TIERS of goal-setting.

Why?

To ensure an even greater likelihood of success and peace of mind.

The aim of our "stretch goals" last week was to ensure that it targets something only a slight reach beyond current capabilities. But this of course doesn't mean we'll achieve it.

Stretching to the next level

And that's fine. The reality is that we won't always achieve this new level of performance.

But we will learn. And we can review our plan for achievement of the goals. Or even amend the goals themselves, bringing them another step closer. And then we launch ourselves off on another attempt.

The problem is…

Stretching to the next level

This is where it can help to have two tiers of goal setting.

Our stretch goal is the second tier. It's the one we're really pushing for. It's the one we put all our focus and attention on achieving.

But it's also something that we completely accept we may not achieve. Or may not achieve, just yet.

But we NEVER judge our self-worth on achievement of this goal. EVER!

Because, although it's just a small stretch, it might take a lot longer than we expect.

This is where the first tier can help.

Set something that is so damn easy that you absolutely should achieve it.

Something like SURVIVAL.

However you want to define that is fine. For me it would be – "My aim this week is to ensure that my family is safely provided for and my trading business is not threatened in any way. I survive to trade another week!"

Stretching to the next level

Don't under any circumstances allow failure to achieve Tier 2 to influence your self-belief. You achieved Tier 1. That is awesome. Well done. Now, examine Tier 2 and find out why you didn't achieve it. And set in place plans for the next assault at that target.

It's all about maintenance of a positive mindset, while at the same time always pushing yourself to expand to new levels of performance and skill.

Tasks for the Christmas / New Year week:

  1. Review the prior article, if you missed it – http://yourtradingcoach.com/trading-business/stretching-to-the-next-level/

  2. Review Dr Steenbarger's blog post. And subscribe to his RSS Feed, or find some other way to get all his future posts.  http://traderfeed.blogspot.com.au/2016/12/how-to-trade-with-peace-of-mind.html

  3. Consider the use of two-tier goal setting in order to maintain a positive mindset, while still stretching to reach the next level.

  4. And set your goals. Trading recommences in early January. What are your goals for the first week? Do not start trading until they're clearly defined.

Go for it!

Lance Beggs

 


 

Stretching to the Next Level

 

Do you have trading goals?

Stretching to the next level

Whatever it is, that's fine.

As long as you're making progress towards that goal.

Let's be honest though… are you actually making progress?

I hope you are!

But I speak to a lot of developing traders and the fact is that MOST are not making progress.

Here is a problem I see over and over again:

Stretching to the next level

The target is just too far away to be able to see any real progress.

And even worse, there is no solid plan for how to get there.

Stretching to the next level

Wrong!

Stop it!

Let's fix this now!

How?

Step 1: Bring your goal closer in time.

Much closer. No more than a month away. Ideally weekly.

Let's say for example that your goal is to achieve $100k per annum. But you're not yet able to ever achieve a positive week.

GOAL: $100k per annum

"That's too far away. Bring it closer."

GOAL: Ok, I will aim to achieve $8k months.

"Which is how much per week?"

GOAL: I will aim to consistently achieve a weekly average of $2k.

Step 2: Reduce the size of the goal till it's just a slight stretch beyond your current capabilities.

A goal of $2k per week is fine. But if you're not yet even achieving positive weeks, it's kind of pointless.

If your goal cannot be reached from your current location, within three or four attempts, then your goal is crap. You'll just churn away week after week getting more and more frustrated. 

Your goal should stretch you just beyond your current capabilities.

And it should be something you feel that, with improvements in process, you might have a chance of achieving in three or four attempts.

GOAL: Ok. Let's reduce the weekly target to a much more achievable $1k.

"Too much. You can't even achieve breakeven."

GOAL: Fine. My goal this week is to achieve a breakeven week.

"Good. You're close to that already. It's just a small stretch. Remember, when you achieve that, and can prove it repeatable, you will then set further goals to stretch to the next higher level. And so on and so on until eventually you're achieving your original goal."

Step 3: Focus on process improvements required to achieve this outcome.

Break the trading process down into as many smaller sub-processes as you can.

Find the one part that, if improved, will provide the greatest impact upon results.

And then set your goal to improve that part of the process.

It might not be sufficient in and of itself to reach your monetary goal. But it's a start. Once achieved, with consistency, you can then find the next area of improvement.

"Break the whole trading process down into parts for me. However it makes sense to you."

"Ok. How about (a) quality trading ideas, (b) quality entry and (c) quality trade management."

"Fine. Which area is currently contributing to your inability to achieve a breakeven week?"

"All of them. But ok, perhaps the trading ideas. Too many, when looked at with hindsight, are just in poor chart locations. Far too late in the move. In retail zones, I guess you could call it. Definitely not where the professionals are trading."

"So what process changes can you make, and what daily goals can you set, to give you greater chance of trading in good chart locations?"

"I can spend some time this weekend defining "quality trade locations" including the point at which entry is too late. I can put something in checklist form. And then I can then work this week with the following goal:"

GOAL: This week I will focus SOLELY on ensuring the vast majority of my trades are attempted in quality trade locations, in accordance with my new checklist. Quality entry and management are of little importance. I can work on them next. But first, I will aim to ensure I'm at least trying to trade in the right areas. I will consider this a success if by the end of the week, 80% of the trades are in areas that meet my definition of "right area" as best it can be determined at the right hand edge of the chart.

"Awesome."

Ok, I totally made up that conversation. You knew that right!  🙂

But the point is that it takes the goal from something outside the realm of immediate possibility, to something that is much more achievable in a short timeframe.

Progress won't be guaranteed, of course. It might take three to four attempts, with further improvements to the process each weekend.

But if progress is not seen after several attempts, break down the process goal even further to something even smaller and more achievable. Your aim is to start accumulating small wins in the direction of your original and ultimate goal.

And if our trader achieves consistency in trading in better trade areas, but still fails to achieve breakeven weeks due to poor entry or trade management, then the process goal shifts to these areas. At some point, a breakeven week will be achieved. The goal might shift then to repeating this same level of performance, just to prove it's not a fluke.

And then… maybe aiming for something greater. Maybe three out of four weeks positive, with the losing week smaller than the average winning week.

Each step just slightly beyond the current level of achievement.

I don't know what your goals are. And I don't know your current level of performance. But whatever they are, if you're just churning away week after week without any clear evidence that you're closing that gap, you need to take action.

Step 1: Bring your goal closer in time.

Step 2: Reduce the size of the goal till it's just a slight stretch beyond your current capabilities.

Step 3: Focus on process improvements required to achieve this outcome.

Stretch… just a little bit.

And fight to get to this new level.

Stop accepting failure. Redefine your goals so that you can achieve small incremental wins.

One step at a time.

Stretch!

You can do it!

Lance Beggs

 


 

Review and Improve

 

You might like to consider your review process as the vehicle which drives your trading business to its ultimate destination.

Whether that destination is ongoing improvement and eventual success… or continued mediocrity, frustration and failure… is completely up to you.

If you've got nothing in place, here is a simple process to get you started.

Once you're comfortable with this, there is great scope to expand it to new areas of review. It doesn't solve everything.

But again, if you've got nothing in place, consider implementing this process RIGHT NOW.

Review and Improve

Look at your last 20 trades. Study them with the benefit of hindsight.

Examine 50 if you prefer. Or 100. Find the right compromise for sample size, which is large enough to be statistically significant and small enough to ensure your review process occurs on a regular basis. But not less than 20. I would suggest that is the absolutely minimum.

Once you've gathered all the trade data and charts, let's check the quality of the setups.

How many of your trade ideas were in chart areas which DID offer potential for multiple-R profits (2R minimum)?

It doesn't matter whether you actually managed to profit, or not.

We're checking the general concept. The trade idea.

We're making sure you're trading in the right areas of the chart.

Did price move from the setup area a sufficient distance to provide multiple-R returns?

Take note of all the trades within the sample which achieved this goal. And now let's check the quality of trade entry.

Now consider those trades that were in good multiple-R setup areas. How many were you able to enter at a place and time which offered good potential to catch those multiple-R profits?

Again, it doesn't matter if you achieved a profit or a loss.

With the benefit of hindsight, given where you entered, is it reasonable to expect that a successful trader could manage that position to achieve multiple-R profits?

How many of these trades would you classify as having a good entry?

Take note of them… and let's move on to check the trade management.

Now consider those trades that were in good setup areas and which were entered well. How many of these were successfully held from entry to the first target level?

How many were you able to hold open to the initial target point, avoiding all temptation to scratch the position early?

And then…

Of those which did achieve the initial target, how many of these were held to a further "hindsight perfect" exit point?

Again, take note of how many achieved this aim.

And now let's use this information to drive our business forward.

Looking at these figures, which area do you need to improve when trading the next sample?

It's important that we focus on one area at a time.

And that we work in order.

Get the setups right first. Are you happy with the number of trade ideas that are actually providing multiple-R profit potential? If not… focus on improving the quality of your trade ideas.

Then work on entry.

Then initial management.

And then ongoing management.

Find the first area that disappoints you. Examine why. Determine a course of action for the next 20 trade sample.

And repeat.

Happy trading,

Lance Beggs