Purpose of trading

Well, this is still is December but the year 2020 is knocking the door, and as always including me there will be many who will have their big plans in place for the new years. And as usual many of the big plans will take a back seat and will never materialize, for the reasons never addressed. So, how about working on one of the many reasons that hold up against making our dreams come true, against the new years resolution to actually work in favor of us?

I think this year if not all, at least one of the few resolutions we make can actually become fruitful and keeping that in mind I am writing this blog post early December. So that we have enough time to work on our lofty plans and actually see it to get executed in 2020. 

The one and only plan that I am going to emphasize on is related to trading, so non-traders might want to skip this post, but hold on! Can you just think of a single instance in your life when you never had to make a trade off? If not, read on, and I hope it's going to be worth a read.

So as the title of the post goes, we need to define the purpose for our trading. This might sound silly, but it really has a profound meaning if you dig a bit deeper. Let's define the type of traders who are in the market (again, very broadly, I am not covering all of them, just to keep the topic simple). There are jobbers, long term traders (I call them speculators, and definitively not investors), market makers, intraday traders, swing traders, hobby traders etc. All of them have one objective that is to profit from their trades. But only very few have a purpose that they are aware of being in the markets and still trade. 

Purpose of trading is completely different from the objective of trading which unequivocally is to make profit. Purpose for an intraday trader will be different from two different traders, and similarly the purpose of the long term trader will be very different from another long term trader. Purpose of trading is a very personal thing, and let no one fool you on this that two traders have similar purpose of being in the market and taking the next trade. Your purpose for trading could be to build wealth for long term, could be to make enough money in next couple of trades to pay the bills for the month, could be to take asymmetric risk for a social media account, could be to take thousands of trades and build that retirement fund, could be to win a trading competition and so on. The list is non-exhaustive but I think I am able to put my point across through this post.

To be really be successful in trading or any field for that matter one has to define his/her true purpose for carrying out a task. Defining the purpose is to be honest to oneself and not getting carried away by what other's achieve or say. Once that is defined and internalized the walk is going to very smooth and will just require your valuable time. So, as there is still time for the year 2020 to kick in, why not use the remaining days of this year to define your actual purpose of trading the markets and based on that formulate your trading strategies to see your dreams come true as time pass.

Happy soul searching!