Feedback is essential to any knowledge-based performance. You must have a way of knowing “how you are doing” with respect to the variables that make up the process…in the case of this conversation, trading. Now, there are some traders who would say, “All the feedback I need to know is if I am making money or not.” To this I would reply…then why not just go to Vegas and gamble, because if you are not measuring, tracking and documenting your trades you have virtually nothing upon which to base your progress upon. And, if you are trading by chance, you my friend are gambling. Basing your trades solely on profit & loss is an ineffective way to measure your “mastery” of the process. If you don’t know what you did right or wrong, then you can’t duplicate or eradicate the behavior. Without this knowledge, you are trading by chance.
Trading mastery involves a set of variables or items that lead to “skill building.” Skill building is critical to any performance based endeavor because that is the path to getting better. And, the essence of skill building hinges on being self-aware. If you are self-aware then what you do, how you do it, the frequency with which you do it and the order become variables that you are not only able to track, measure and document, but you will be able to manipulate as well.
Firstly, skill building involves a set of trading protocols. A protocol is a sequential order of steps toward an aim or goal. And, protocols can be found across the board having to do with anything that involves performance; like medicine, law, accounting and sports, to name a few. These trading protocols are made up of strategies, procedures, set-ups and rules. They are talked about, reviewed and evaluated in… Continue Reading
