End of Year Review
|December 17th, 2012, 01:31 PM||#1 (permalink)|
Futures Experience: Advanced
Platform: CQG;Genesis Trade Navigator
Broker/Data: RJ O'Brien
Favorite Futures: Futures
Posts: 15 since Apr 2012
Thanks: 0 given, 10 received
End of Year Review
This time of year is a good time for review with a goal to improve strengths, learning from weaknesses and mistakes. We believe in the principle of improving and developing your strong side rather than improving your weaknesses. There are different ways of doing that.
For example reviewing your trading sheet with codes. There are code for Entries, Exits and Exit behavior codes. Data can be sampled using these as a filter. Although there is subjectivity to the Exit behavior codes, over time it will reveal your behavior with regards to the trade.
Are you impatient, is your Entry too early? Are you greedy and do you take profits too soon? Are you compliant with your trading plan? How do you measure your compliance? Do you have somebody holding you accountable for your trades? Perhaps a coach or a friend who is keeping you accountable?
Is your strategy profitable enough to keep the business going? How do you measure profitability? When is the cut-off to decide that a strategy does not fit your criteria anymore?
Lots of questions and at the end of a trading year it would be a good time for a review.
Another method to evaluate your business is the SWOT analysis. It also deals with strengths and weaknesses, opportunities and threats. The strength of the SWOT analysis is to identify a match between a company’s strength and upcoming opportunities. For example if you have multiple strategies for each different market (Side ways, Down, Up market) but your analysis shows that your strength really is in trend following, you might want to focus only on those markets and specify perhaps more in detail what criteria need to be looked at for you to trade that market.
Learn from your weaknesses and take action on how to solve it. For example, if you are fearful of entering the market, talk to somebody who is willing to enter the trade for you (broker). If you feel you do not have enough knowledge about the market, consider taking a trading coach or work on your inner fears by taking a coach that focusses more on psychology.
Reviewing your trades on a weekly, monthly and yearly basis is and should be part of the routine of trading. Keep a diary of your yearly review and progress.
Then set targets for the New Year in a detailed plan.