somrat4030
Well-known member
Forex Forum is best place for learn more about, how to set up your successful trading goals.
Once Lawrence J. Peters said, "If you don't know where you are going, you will probably end up somewhere else." That is the importance of goals in the simplest words. People with vague vision never reach their destinations. They don't get up every morning with a burning desire in their hearts to do something. They lack goals and have nothing to look forward to.
So, Having clear and achievable trading goals will enable you to select a trading strategy that best suits your needs, and will also provide you with a benchmark with which to measure the success of your efforts. Setting up these goals should be the first step in developing your portfolio, since it will give you a means to determine and manage your risk threshold, and to implement buying and selling parameters which are better suited to your abilities, bankroll, and time available as a trader.
Here are some tips for setting a perfect trading goal:
1. Never trade money you cannot afford to lose..
This may be actually stretching things a bit too far, but what it indicates is that when you trade you must be prepared to lose money. You do not have control over how the market will behave or how your trade will move. But, you surely have control over how much you can afford to lose. In trading, higher returns entails higher risks but just assuming higher risk does not assure you higher returns. It is this paradox that you need to understand before your start trading. Every trade must be seen in terms of the maximum loss that you are willing to bear and the maximum capital erosion you are willing to tolerate.
2. Reward Ratio
You can also create goals that help you analyze the market and identifying good trades. Financial trading is all about finding the right opportunity and investing your money. However, this task becomes challenging if you have no goals or plans to support your decision. Therefore, you need to set up your goals to evaluate the market condition. You can create these goals by comparing your profit and loss ratio and reviewing the market. You can define a day of the week where you check the progress of your goals and come up with new ones.
3. Stop Despairing Over Losing Trades.
Losing trades are apart of the game. You cannot be in a winning trade without risking the possibility of it being a loser. Every trade has the potential to go against you.
4. Keep a detailed documentation of your trades..
This is a very important trading goal as it helps you to take a dispassionate look at what trades worked and what trades did not work for you. That is an important input for your future trading strategy. A detailed documentation with comments is very important. This helps you identify trends that have made your trades successful and trends that have resulted in failed trades. It also helps you identify whether you have booked profits too soon or if you have triggered stop losses too late.
5. SETTING THE RIGHT STRATEGIES
Your strategy should define your goal as well as its importance to you, and should be easy to track and record. To this end they should be realistic so that you can build up your confidence and stay motivated to keep on trading. Though most importantly, your strategy should allow for time, since successful trading takes a lot of it. So remember to be patient, and your investment strategy will likely pay off.
6. Measure the Progress
There are hundreds of techniques to measure your progress while trading. One of those techniques is to create a trading journal. Evaluating your trades is as important as setting up your goals. Even if you have the best plans and goals for successful trades, you cannot succeed without proper accountability. Therefore, keep track of your trading activities and evaluate your progress daily. Another way to measure your trading activities is through the trading platform. When you register and perform your trading tasks through a single platform, you can generate insights.
7. Use & Stick to Your Stop Losses
Stop giving it a few more cents. Or in the other direction: Stop pre-maturely stopping out because you're scared, the stock went a little bit against you. Define your stop BEFORE the trade, and stick to it.
Having trading goals that compliment a solid strategy will help you build confidence in your trading. Download our free guide for more information about how to build confidence in your trading, and be sure to check out our range of additional guides to help you in your trading journey, whatever your skill level.
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