things to ponder from an email:
THE SECOND HOLE -- STICKING THE GREEN
All athletes have some type of goal they want to reach in a competition or throughout their career. The difference is some of these athletes reach their goals while others fall short and become discouraged. And failure, as we all know can lead to a loss of confidence, loss of concentration,
and poor performance.
Today's article is going to talk about the two primary types of goals (Outcome and Process) and the Four qualities that ALL Effective goals must have (Achievability, Measurability, Controllability, and Flexibility). By walking you through this effective goal setting process, we are going to help you tee the ball up on your next trade and "stick the green".
Outcome vs. Process
The basic idea is that in order to reach your Outcome, you must go through a Process. For the golfer, an Outcome goal might be to shoot in the mid 80's. In order to achieve that outcome, the golfer must average a score of bogey for each hole. The score on EACH hole is the Process that they must take to reach the Outcome.
As an Online Trading Athlete, your goal might be to make $10,000 per month. Is this an Outcome or Process goal? Outcome, of course, so what is the Process you are going to go through to reach your goal? In other words, what are you going to do EACH trade, EACH day to accomplish your Outcome goal?
One strategy athletes often use is called Goal Sheets. These Goal Sheets allow the athlete to keep track of not only their Outcome goal but also the Process they are going to go through to achieve it. Writing down these goals helps them stay focused. We believe that this strategy can work for Online Trading Athlete's as well.
The concept is pretty simple but as an Online Trading Athlete, you oftentimes forget to break down your goals. Remember the Outcome is the End Result goal, while the Process defines what steps you are going to take to achieve it.
Now that you understand the different types of goals there are, let's make sure that you are setting up what we call "Effective Goals".
Effective Goals
All Effective Goals have four things in common.
* Achievability
* Measurability
* Controllability
* Flexibility
Realize that if you set a goal and it does not have ALL of these qualities then you are setting yourself up for failure.
Achievability
Is the goal realistic for you? Are you capable of reaching that goal in the given amount of time? Do you have the ability/experience/talent to achieve the goal? A rookie trader that sets the goal of making $50,000 in the first month of trading may be setting herself up for failure.
Similarly if a first time golfer, who has never swung a club before, decides to set a goal of shooting scratch golf for his first round, well, he's probably in for a long day. Is it possible for these 'unrealistic' goals to be achieved? Who knows, but I think we would all agree that if they were accomplished, it would be the rare exception and not the norm.
Measurability
Can your goal be measured? Effective goal setting requires that you be able to monitor your progress towards achieving your goal. For the Online Trading Athlete, this is pretty straightforward if you have set a financial goal since it can be measured in dollars. However, keep in mind that you should be careful when setting goals that are strictly defined in terms of financial accomplishments since these goals, for the most part, are out of your control.
Controllability
Do you have complete control over whether you will accomplish your goal?
A golfer who has set the goal of scoring par on every hole may have set himself up for failure. Why? Let's take a closer look at it. The reality is that no matter how good the golfer might be, he has no CONTROL over the wind, weather, greens, fairways, etc. This golfer could make
great strokes but come up short because of wind conditions. Was the goal to shoot par achievable? Sure if he has a 1 handicap. Was it measurable? Of course, it 's a number. So was it Controllable? Well, as we just explained, not really.
The perspective is the same with the Online Trading Athlete. Imagine youare the golfer, the stock you are trading is the golf ball and the market is the weather or course conditions. Making a quality trade (great swing and contact) does not always mean that you will have a winning trade (land on the fairway) because once you make contact (hit the enter button to make the trade), it is out of your Control. Understand what we're getting at?
Flexibility
This is the fourth characteristic of effective goal setting and It looks at the question, "Are you willing to adjust your goals to achieve success?" Being flexible means reevaluating your goals if you find that they are unrealistic, immeasurable, or uncontrollable. Going back to the rookie who planned on making $50,000 in the first month, hopefully, this trader would realize that this lofty goal was probably unrealistic, for now, and would be flexible enough to change the goal. As an Online Trading Athlete, achieving success is, for the most part, about confidence. Realize that when you set goals that are challenging and
obtainable you are actually gaining more confidence. For this reason, it is important to constantly monitor, reevaluate, and adjust your goals, throughout your career as an Online Trading Athlete.
Now that we have equipped you with the knowledge of Outcome vs. Process goals and the four ingredients to setting Effective Goals, go ahead and put it to use. If you currently don't have any Outcome goals, create some and write down the Process you are going to go through to achieve them.
If you already have some goals, then go over them and see if they qualify as being effective goals.
Well, there you have it. The Second Hole is finished: On in 2, out in 4. Gotta work a little on the putting! This week we talked about the difference between Outcome and Process goals as well as the Four characteristics of ALL Effective Goals. Next week we will make our way to the "Third Hole -- FORE!" and talk about anger management and playing this game One Trade at a Time. So until then.
Stay Focused! |
