Of course you’re watching your account balance and whichever indicators and signals you use, but I’m talking about your trading *business* numbers.
Every business owner knows that there are specific operating variables that make the bottom line what it is, and by focusing on those numbers and what makes them, the profits will show on the bottom line.
In a ‘regular’ business, you’ve got to watch things like:
– labor hours
– advertising costs
– efficiency
– profit margin
– shipping
– etc, etc.
By measuring and closely monitoring the business variables, the goals of the business can be more predictably met. These are also crucial when it comes time for forecasting.
Well, trading is no different.
If all you’re watching is your bottom line, well at least you’re watching that much. But you are missing out on the real opportunities to improve and bring predictability to your end-of-the-month numbers.
Additionally, you really do want to have the abilityto PLAN for your trading business. Lacking certain information makes it really difficult to envision where you are likely to be 3, 6 or 12 months from now.
We’re talking about variables like:
– average return per trade: what can you reasonably anticipate making over the next 20-50 trades?
– your true winning percentage: is your current trading really performing like you ‘think’ it is?
– your true profit-to-loss ratio: is your trading really as profitable as you’d like it to be?
– your hourly rate as a trader: is all the time and blood and sweat that you’re putting in really paying you what you’re worth?
These and more are all easily figured for you and all you need is your current trading information and about15 minutes. Check out the Trading Performance Analyzer.
http://www.insideouttrading.com/tpa/
Get a real business snapshot of where you’re at right now and see where your opportunities are to boost your bottom line and bring some predictability to your trading.
http://www.insideouttrading.com/tpa/
You’ll be very glad you did!
Cheers
Brian
Trading Self-Defense Instructor
P.S. If you’ve already gotten the Trading Performance Analyzer, then please make sure that you put it to use. I included you here because there are a lot of things that you can get out of the numbers in trading and I wanted to make sure that you had this additional food-for-thought.