Setting realistic trading goals is an exercise that both helps you maintain focus and gives you a way to measure your progress.
Goal setting needs to be looked at like a marathon. There is the big final goal, which is the finish line. Between the start and finish lines, you have your mini-goals. These are your checkpoints. These checkpoints keep you motivated. They help you to look back and see everything you have accomplished.
Checkpoints will lead to consistency. Consistency leads to habit building. Habit building leads to results that stick.
It is important in the beginning for you to set goals that you know are achievable to build your confidence and trust in yourself. There are three steps to setting up checkpoint goals you can hold yourself accountable to.
Your goals need to be realistic and specific.
Goals should have a time frame.
These goals need to be measurable.
My college wrestling coach taught me that if you are going to set a goal for yourself, you need to be able to evaluate yourself on that metric or the goal is useless. If your goal is to “be rich”, what does that look like? If you do not really know how to answer that, how could you ever achieve it?
Your trading goals need to be realistic and specific
You need to be able to actually reach your goals. This is not said to kill dreams, but to help you understand what you are capable of achieving at this time. If you set goals too large for yourself, you will get discouraged and quit.
A good example of a realistic and specific goal would be that you want to grow your account by 1% this month. This is very realistic and attainable. If you start out with $500 in your account, that means you will need to make $5 trading to reach that goal. Starting small builds patience and discipline.
Goals should have a time frame
The next thing to focus on is making sure you set a realistic time frame for yourself. In the example above, we focused on wanting to achieve 1% growth in 30 days. Making $1,000/day trading within your first 3 months of trading is not a realistic goal with your trading knowledge or account size of $500.
These trading goals need to be measurable
There needs to be a way to determine that you have reached your goal. The goals need to be set in a way where there is only a yes or no answer. Did I make 1% on my account in 30 days? Yes or no? Did I become rich? Well, what does rich look like to you? That is not a measurable goal.
If you follow these steps when it comes to setting trading goals for yourself, you will find that you have developed an easy-to-follow roadmap on your way to success in the trading world. What goals have you had in the past that worked for you? Let us know below in the comments