Are you willing to explore the ramifications of your trading? Trading in terms of your objectives is a key to enhancing your success as a trader. Here's how to use your goals to develop powerful trading strategies. By Ari Kiev, M.D. The dictionary defines commitment as a decisive choice that involves a definite course of action. In trading, this refers to a proactive approach in which you promise a result and then conform your trading to that result. The promise creates a discrepancy or gap between where you are and where you have promised you would be. The discrepancy becomes a source of tension that, ideally, motivates you to determine what must be done to bring reality in line with your objectives rather than simply doing what is comfortable or habitual. It is not simply a question of working harder or pumping yourself up with positive but empty affirmations, but a willingness to explore all the ramifications of your trading. In order to do so, you must answer questions such as: • How much do you intend to make? • When do you intend to make it? • What do you have to do? • What beliefs and habits of trading must you relinquish? • How much capital do you need? • How many shares must you purchase and how long should you hold them to reach your objectives? • When should you enlarge your position? • What must you pay attention to in order to manage your losses? • How much more capital can you put at risk to increase your profitability while managing your downside risk? |
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