Updated: Jul 20
2nd July 2021
This article stems from a trading coaching session that I did with Steven Goldstein recently as part of his trader coaching program. I have been consulting Steven Goldstein of Alpha-R-Cubed as a trader coach since November 2020. We meet (virtually) every six weeks to catch up and talk about my trading. I have found the coaching to be really beneficial and can highly recommend his program.
In the session we did this week, he asked me what my ideal outcome would look like 5 years from now. He asked me what sort of returns I'd like to have generated over that period and where I'd graduated to as a trader and as a person over that time. My answer was that I'd be happy if I was able to grow my trading capital by 25% - 30% per annum consistently in Pounds over that period and be calm, deliberate and patient in my actions. I believe this is an achievable goal.
He then asked me to imagine it's 5 years’ time and I have achieved what I set out to achieve. It's 2026, the returns have met my goal, and I'm in a calm, confident headspace with my trading. He then asked me to look back over the prior 5 years and tell him what I did that allowed me to reach that point in my trading.
Goals From Trading Coaching
Here's a list of bullet points I jotted down:
Stuck to my playbook with discipline: We all need a trading plan or a "playbook" that dictates what setups we will trade, how we will trade them, how much risk we will take on each trade, how much overall portfolio risk we will take at any one time, what we will trade etc, etc. This is important. It's like your "rules" of your trading business. Failing to plan is planning to fail. It's important to develop your own playbook and to then stick to it. I believe that success will be achieved if I stick to the rules in my playbook.
Managed risks well: Risk management is the cornerstone of successful trading. It is vitally important that you manage your risks so that you don't suffer devastating drawdowns in your trading capital. Keep losses small and within your defined risk parameters. I can't stress this enough. When I look back in 5 years' time, I want to be able to be proud that I never allowed a loss to get out of control, and all losses over the prior 5 years were inside of my maximum risk threshold.
Maintained a healthy mental state: Being in a good mental state is really important for successful trading. If you're happy and content in your life, you'll find that also spills over into your trading. Do what you need to maintain a healthy mental state.
Stayed physically healthy: Lately, I have been noticing more and more in the trading books I listen to that successful traders live a healthy life. They exercise regularly, eat well, get enough sleep and don't consume excessive amounts of caffeine of alcohol. In 5 years’ time, I would like to look back and say that I did well to maintain a healthy physical state and that it contributed to my trading success.
Consistency: I'd like to look back in 5 years' time and be able to be proud of the consistency of my trading. I didn't get despondent. I didn't get too exuberant. I maintained a consistent state of mind, and my approach to trading was consistent, and my results were consistent too.
I was patient: When I look back in 5 years' time, I want to be able to say that I was patient for the market to present me with opportunities that conformed to my playbook, and that I didn't try to force trades that I shouldn't have. Patience is key. Sometimes the best trade is no trade. It's important to remember this.
I played my own game and didn't worry about others: It's human nature to look around at what others are achieving. This can sometimes lead to feelings of inadequacy - particularly when we compare up. Avoid doing that. Yes, be ambitious and strive to improve, but also remember that you are playing your own game against yourself in trading. Focus on your own game, and don't worry about others.
"Comparison is the thief of joy"
These are some of the most important aspects that I want to look back on in 5 years' time.
I found this to be a really good exercise. It's something I would encourage you to try and do for yourself too. Give it some thought, decide where you want to be as a trader in 5 years time and then build the story that got you there. Then seek to action it in your life and in your trading.