Setting Your Trading And Investing Goals
What's the best way to go about setting your trading or investing goals? Well, as with most goal setting in your life it involves two important elements: perceived difficulty, and how specific you are in stating your goal. These two elements play an important part in attaining your goals.
The more difficult a goal is to achieve and the more specific the goal is, the more likely you are to raise your performance level to achieve the goal. Now, this doesn't mean that you will automatically achieve the goal because it is difficult and specific, it means that with these two elements in place you are more likely to produce high performance which in turn will produce the best overall results.
So with a trading/investing goal example to earn $50,000 for the year, a more difficult and specific goal may be $51,600. If your brain perceives $51,600 yearly earning as a more specific goal than $50,000 yearly earning then you are more likely to raise your performance to achieve your goal of $51,600.
Setting difficult and specific goals provide a better outcome than setting goals you know are easily attainable. So, if you believe that you can comfortably achieve $51,600 through your trading, then raise the level to something more challenging like $72,400.
Don't be unrealistic though, as you are more likely to perform if you believe you can achieve your goal. Base your goal on your knowledge, training, skills and past experiences. If you know it can happen, that you can make it happen, then your performance can increase.
So that is the setting of your trading goal. What about along the way...on the journey to achieving the goal? You will be most committed to achieving a goal when you believe that achieving the goal is important. Also when you can see that progress is being made towards achieving the goal, you get the best results.
A way of measuring your trading progress, can be done as simply as keeping an ongoing running tally of your trading outcomes for the year. For example, if your goal is to earn $72,400 from trading for the year and by half way through the year your trading tally is $38,100 you can measure how well you are placed to achieving your goal - you have more than half of your goal achieved.
Most people who start trading shares or investing in shares do not have goals. When asked about what their trading goals are, they don't know and they don't worry about it. The most common response is "to make some money". This is neither specific nor difficult nor does it have a big "Why is this goal important" nor is it measurable.
Think about your trading goals. Set yourself some specific, difficult and measurable trading goals and understand why you want to achieve them. Then start measuring your progress.
Kevin Hogan discusses in his textbook "The Psychology of Persuasion", the idea of "the least acceptable result" and how this is the goal that most people will achieve from any activity. What is your trading or investing least acceptable result? Don't let this be your goal, set your trading/investing goal today and raise your performance and watch the results. - 23311
The more difficult a goal is to achieve and the more specific the goal is, the more likely you are to raise your performance level to achieve the goal. Now, this doesn't mean that you will automatically achieve the goal because it is difficult and specific, it means that with these two elements in place you are more likely to produce high performance which in turn will produce the best overall results.
So with a trading/investing goal example to earn $50,000 for the year, a more difficult and specific goal may be $51,600. If your brain perceives $51,600 yearly earning as a more specific goal than $50,000 yearly earning then you are more likely to raise your performance to achieve your goal of $51,600.
Setting difficult and specific goals provide a better outcome than setting goals you know are easily attainable. So, if you believe that you can comfortably achieve $51,600 through your trading, then raise the level to something more challenging like $72,400.
Don't be unrealistic though, as you are more likely to perform if you believe you can achieve your goal. Base your goal on your knowledge, training, skills and past experiences. If you know it can happen, that you can make it happen, then your performance can increase.
So that is the setting of your trading goal. What about along the way...on the journey to achieving the goal? You will be most committed to achieving a goal when you believe that achieving the goal is important. Also when you can see that progress is being made towards achieving the goal, you get the best results.
A way of measuring your trading progress, can be done as simply as keeping an ongoing running tally of your trading outcomes for the year. For example, if your goal is to earn $72,400 from trading for the year and by half way through the year your trading tally is $38,100 you can measure how well you are placed to achieving your goal - you have more than half of your goal achieved.
Most people who start trading shares or investing in shares do not have goals. When asked about what their trading goals are, they don't know and they don't worry about it. The most common response is "to make some money". This is neither specific nor difficult nor does it have a big "Why is this goal important" nor is it measurable.
Think about your trading goals. Set yourself some specific, difficult and measurable trading goals and understand why you want to achieve them. Then start measuring your progress.
Kevin Hogan discusses in his textbook "The Psychology of Persuasion", the idea of "the least acceptable result" and how this is the goal that most people will achieve from any activity. What is your trading or investing least acceptable result? Don't let this be your goal, set your trading/investing goal today and raise your performance and watch the results. - 23311
About the Author:
Learn more about how to trade shares with Just Shares and visit our website where you can find out all about Just Shares' share trading course and how Just Shares can help you be successful in trading shares.
posted by Mr. Forex at
3:55 AM
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