Is Trading for a Living Your Goal … or Just a Dream?

dreamWhen you ask binary options traders what their goals are, you will get a large variety of responses. Among the more serious traders, however, you will get goals like these:

  • “My goal is to make my first million by the time I’m 25.”
  • “My goal is to get rich trading.”
  • “My goal is to net 10 profitable trades per month.”
  • “My goal is to trade binary options for a living so I can quit my day job.”

… And so on. Some of these goals are useful goals, while others are not. Some of them you could argue are not actually goals at all, because they lack specificity and achievability. And that is where a lot of traders go wrong. The problem is not that they do not set goals; it is that they do not set realistic goals which they can realistically pursue. When your goals are unachievable and do not allow you to set up a positive feedback cycle of repeated success, all too often they dissolve into dreams.

 

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The definitions of the words “goal” and “dream” are very different.

A dream is simply a possibility—something you contemplate doing. And that is all. Some of the definitions of dream are quite unflattering. A dream may be defined as something you simply fantasize about. It has even be defined as an unrealistic or self-deluding fantasy.

A goal on the other hand is defined as the object of effort. A dream does not necessarily entail any effort at all. You can have a dream without the slightest actual inclination to act on it. But you literally cannot have a goal unless you are actively pursuing it. Any “goal” which is not actively pursued automatically becomes relegated to the land of dreams. If you believe that you can reach a given destination without taking the journey, you are indeed deluding yourself with an unrealistic fantasy.

So that raises the question. Are you a goal-setter or a dreamer? Are you a doer, or do you have your head in the clouds? To start answering these questions, we can examine the four examples of “goals” mentioned earlier and break down each one and analyze it for its realism and efficacy.

  • “My goal is to make my first million by the time I’m 25.”

This one is a mixed bag. It actually sets a deadline, which is good. Goals that do not involve any kind of time measurement often become hard to achieve, because you are not setting up any milestones along your journey. But taking a second look at the goal above, are there any milestones? Is a million dollars really a realistic milestone, and by age 25? Maybe if you are already starting out with a huge account! We would all love to be millionaires by the time we are 25, but this goal needs a lot more milestones—smaller goals leading up to the big one, and on a realistic timeline. Until that happens, the “goal” above is more likely to remain a daydream.

  • “My goal is to get rich trading.”

This one is even more vague. It does not mention any timeline for achievement, and there is no definition here of what it means to “get rich.” Rich is all relative along a pretty vast scale. If you have ever met someone with a few million dollars stashed away, they will quickly inform you that they are not “rich” even though you may think of them as such. The ruling class has a lot more money than they do and a lot more influence. And because you will constantly redefine your idea of what it means to be “rich” as you move up in the world, a goal like this can literally remain unachievable forever, even if you are making more and more money trading binary options.

Instead, you should set small, measurable goals with specific amounts of money and specific amounts of time. Or better yet, set goals that relate to profiting. The rate at which you are moving up in the world is actually more important than the exact level you are at. Focus on boosting your percentage of profitable trades, and your account will grow. While you are at it, you probably should work on developing a more comprehensive definition of what it means to be “rich”—something that goes beyond the money.

  • “My goal is to net 10 profitable trades per month.”

Now we are talking. This is a realistic, achievable goal, and not a dream (assuming of course you are actually working toward it). It is specific, and includes an actual amount of trades, and a timeframe for getting them. Instead of focusing on dollar amounts, you are focused on good trades. You can build off of a goal like this. If you achieve it month after month, your larger goals will gradually be fulfilled along the way.

Is it a perfect goal? Not quite. One possible problem is that it sets a quota you may not be able to achieve every month. It all comes down to your trading system and what it is capable of producing in terms of results. If your testing shows you that you can reasonably expect 10 profitable trades per month, then by all means, go for it. But if your system tells you that you can only realistically expect 7, then shoot for 7. Do not pursue goals which will cause you to compromise on your trading rules by taking trades that do not meet your criteria.

  • “My goal is to trade binary options for a living so I can quit my day job.”

This one is pretty good as a long-term goal, though it will not be achievable unless you set some shorter-term goals along the way, like the one that I talked about above. This is a better long-term goal than something like “I want to get rich trading binary options.” Why? It is a more comprehensive vision, and reflects on your lifestyle. Getting “rich” is really vague, but being able to quit your day job is something specific which will definitely impact your day-to-day life. Trading for a living offers you autonomy, so your wealth goes beyond the money.

What Are Some Other Examples of Helpful Goals?

The exact goals that you set for the near and long term will depend on your own trading strategy, disposition, and personality. A goal that is right for one trader may be wrong for another, and vice versa. Some goals, as discussed above, are essentially useless, or useless if they are not paired with other milestones that can lead up to their grand achievement. Below are some examples of useful goals you could feasibly set, depending on what you are trying to do. Notice that not all of them necessarily involve money directly:

Short Term:

  • “I want to boost my win percentage from 84% to 87%. Based on my test results and some of the changes I am planning to make to my system, this should be possible.”
  • “I want to see if I can net three more winning trades per month. I believe I can do this if I start trading more assets. I am going to test those assets out and see how they perform.”
  • “I am going to eliminate my addictive trading behaviors, starting with my obsession with chasing losses. The next time I feel like chasing losses, I will turn off my computer instead.”
  • “I am going to start waking up an hour earlier so I can get more trading done during the early hours of the day.”

All of those goals are specific and achievable. You can literally work on them this week. There are no intermediary goals you need to achieve to get to them. So they work great as stepping stones on your way to long-term goals.

Long Term:

  • “I want to trade for a living, and do everything I need to in order to quit my day job as soon as it is realistically possible to do so. I need to make enough money trading that I can support my lifestyle while still growing my account each month.”
  • “I want to make enough money to support my favorite charities and become a philanthropist. I want to be able to help people.”
  • “I want to make enough money trading to go back to school. I always wanted to go back to get a second degree, and this way I can do it.”
  • “I want to learn how to trade well enough to get hired by a top trading firm.”

These goals are superior to “I want to get rich” because money is a means, not an end, and your goal should be a destination—not the car you use to drive there. Supporting a charity, going back to school to continue your education, supporting your family and your lifestyle—these are all destinations. Trading for a firm would be a lifestyle change. Getting rich on the other hand is not a destination, simply a vehicle. If you focus all your energy on getting a vehicle but never give any thought to your destination, you will soon find yourself feeling lost.

Learning to set goals as a binary options trader is essential if you want to win. Unachievable goals are just dreams—and because you cannot get anywhere close to them, you will constantly be faced with disappointment. This in turn will discourage you more and more. But if you set achievable goals, you set up a positive feedback loop where you constantly are proving to yourself that you can succeed as a trader. This helps you to build up confidence and trade better than ever.