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Hi,
The old joke about the guy who acts as his own lawyer is still funny, but
perhaps it is better than having no lawyer.
It is possible to self-assess your developing trading skills from a
psychological perspective.
By definition, you are not objective about yourself.
However, if reasonably honest assessments are made regularly, on a standard
basis, the relative changes can be taken as significant and can give you
some insight into your own psychology.
Self-assessment on an approximately once per quarter basis is recommended
as an appropriate frequency for revisiting trading skills. As a
by-product, regular self-assessment gives a basis for self-reward and
assists in identifying any areas needing additional, focused attention.
Do not take the absolute assessments too seriously - look who made them!
The approach is most effective for the trader when the self-assessment is
performed without viewing any prior assessment. The results are then
compared with prior assessments. An occasional, independent review is
also recommended wherever practical.
A basis for self-assessment could include measuring your status against
criteria such as:
Security in Method and Discipline
Opinion Management
Lack of Arrogance
Pulling the Trigger
Money Management
Entry/Exit Management
Management of Reward and Risk
Knowledge of Self
Vacation Management
Physical Health
Surrender and Domination
I use a scale of 0 meaning no skill, 10 being the level of skill I aspire to.
I also log the target I have for next quarter against each criteria - not
as a basis to punish myself for slipping back or failing to meet the target
immediately, but for deciding which areas of behaviour to focus on in the
next three months.
My experience is that I "know" about some of my deficiences in the above
areas before I am consciously aware of them. The self-assement process
"drags" the knowledge onto the printed page.
Two criteria I have recently added are "Management of Mistakes" and
"Exploitation of Opportunity" - so I have no history of my self-assesments
but I expect similar benefits to accrue in these areas when I have a
relative assessment next quarter.
The above asssessment criteria are deliberately given without explanation -
what matters is what they mean to you not what they mean to me.
Happy introspection and personal growth.
I believe financial wealth can follow psychological wealth which often
follows ... - in a virtuous circle.
Regards, Ric.
P.S. The reward to risk ratio of self-assessment has been higher for me
that one trade ever could be. And no brokerage!
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