As with anything we do in life, to be successful in trading depends on the discipline we have to apply our knowledge and everything we learn as we go along on the way.
Structuring, designing and applying strategies in trading (regardless of whether we are stock traders, cryptocurrencies or whatever) is essential, and for this, small details matter, and a lot. In this sense, things like establishing Take Profit and Stop Limit points are fundamental factors for success in our operations as traders. So is capital management and the measurement of time or timeframes in which we decide to operate.
Ultimately, one of the things we must decide when we trade is... What kind of traders are we? Are we scalpers? Or maybe we are day traders?; but beyond that, what bases the success we will have as traders is the level of our personal earnings expectations, the reality of the market, and our trading knowledge coupled with the proper management of our emotions.
So, when we are traders, then we have to be able to take too many things into consideration; and that is why we should know how to systematize our tasks, based on our expectations, the reality of the market, the type of trader we are, our risk management, the size of the capital we have and the knowledge we have about technical analysis. .
But at the end of the day, the only thing that can tell us if we are successful traders or not, is if we are managing to constantly increase our trading capital. That is why it is very important to measure our performance as traders, because from this measurement, we will be able to make the necessary adjustments in our trading system and in our expectations so that we can be better and better traders.
Because, a trader who does not know how to measure its trading performance is like a blind person driving a bus on the highway, if it does not crash into another vehicle it will be a miracle. In other words, it will not be able to function properly in the market and its operations will be erratic, since it has no idea where it is stepping on, or where it comes from, or where it wants to go.
Measuring our performance in something necessarily requires that we establish a level of concrete and coherent expectations, and trading is no exception. Measuring, then, our performance, will allow us in this sense, to identify our successes and our errors when operating in the markets, and this will be of great help to us in every way.
Now, a method that I use a lot, as a trader, to measure my performance in the markets is to create and make use of spreadsheets (created in Excel or with OpenOffice), since this allows me to measure in each operation, hit percentages, amount of money won or lost, percentage of win or loss, time of each operation, etc.
All the information that I am see in this way makes me a better trader, because in my trading system and strategy there is no room for improvisation; instead of that everything is based on the quantitative, objective, timely and truthful measurement of everything I do in the markets.
Will I decide to trade Bitcoin this week, or Ethereum , or HIVE, or any other cryptocurrency on the market? My system of measurement or average performance in trading will advise me which is the best option in that sense for me, based on my previous performance; and if there is no previous performance, then will register the perfomance and will bre records to serve of reference for future operations. What percentage of my capital will I decide to invest? My measurement system or average in trading performance will allow me to make a better decision in this regard.
Basically, the uses of a performance averaging system in trading are vast, and its benefits immeasurable. If you do not believe what I tell you, and you are a trader, try to operate by measuring your results and your performance. I am sure that the results will pleasantly surprise you.
Averaging our performance will allow us, on each trade, to identify how far ahead or behind we are in relation to our profit targets, and that, my friends, is worth gold.
What do you think about the topic discussed? Please comment.
@piensocrates