Focus On The Process & Not The PnL

This post by Will Ferrell really made me laugh but I also think that he’s truly hitting the proverbial nail right on the head.  We can now tuck 2017 safely in bed and it was a record breaking year that saw the Model Portfolio up 1804%  How do you top something like that?  Can you top something like that? It was exciting as a leader and mentor to see so many of my members happy and successful.  I sit here now and I wonder what kind of goals my members are making for 2018?  I envision that many are PnL related.  To clarify, I am imagining that many traders are creating dollar targets for themselves in 2018 (and because we had such a successful 2017 I am also wondering how inflated those monetary goals are).  One example may be; “I want to make $100,000.00 in 2018.”  While PnL targets can be beneficial in that they help you to create process goals to get there; I fear that there is a yawning trap that traders can fall into here.  I always get concerned when one of my students appears too focused on dollar counting or their bottom line.  While I agree the bottom line or your results are everything; it is THE PROCESS or focusing on the process that will get you to that bottom line you desire.

One of the things that seems to happen regularly is that at the end of the day, week, or month many traders in my chat room post their PnL.  What if at the end of each trading session I instead had you post a trading Report Card?  I want to use 2018 to focus on one monthly goal.  It could be position sizing, consistency, a particular setup in our methodology, limiting losses, the entry, the exit, mastering fear and greed, etc.  There are any number of things that can be addressed.  The Report Card would be your daily progress report on that goal.  You would give yourself a GRADE for that trading session on that goal.

You would pick one goal.  One weakness to focus on in your process loop.  You then work intensively on that one goal; developing solutions to achieve that goal.  You then would complete a Report Card at the end of each trading session on progress for that one goal.  Initiating a Report Card into our daily routine at WealthCampus will help anchor reviews of performance, goal setting, and efforts at improvement. It is a great way for each trader to become more accountable to themselves and to the process.

Sharing the report card with the community, the mistakes, the accomplishments, the lessons learned, it greatly improves everyone’s learning curve.  It helps us to develop by learning from the experience of others.  I have served as a role model for quite some time now and this presents us with the opportunity for multiple role models.  I will participate as well and I will be sharing my own report card with the community.

By focusing on one goal a month, it is my endeavor to push my traders to focus on the process and not the bottom line.  In making your greatest weakness your greatest strength, one goal at a time, you perfect your craft and ultimately affect and impact your PnL.

So going back to address the question that I posed in the opening paragraph; How Do You Top A 1804% portfolio performance?  What we CAN DO, is improve our own personal trading habits, and attempt to eliminate mistakes and make our biggest weaknesses our greatest strengths.  If we can do that, if we can focus on the process, then we have a shot at hitting your personal PnL that you’ve set for yourself in 2018.