Special thanks to Pradeep at stockbee for the inspiration, and I also appreciate the fly’s invest within parameters post for a little different perspective.

I’m sorry, but if you failed last year, a simple “new years resolution” isn’t going to make you a better trader or investor. And if you succeeded, you need to learn and grow. Everyone else is, if you do not, they will leap right over you.  The New Year is not simply a time for pipe dreams and hopes. I hate the BS goals everyone makes with no intention of keeping. “I want to look like Brad Pitt and find someone that looks like angilina to be with me” but that doesn’t mean they’ll get it. In fact, they won’t. A resolution requires action, but it requires a lot more than that. It requires you to actually no which direction you are headed, where you need to go, and how you can get there, and then you actually have to take the action. But along with that action you have to develop the mental and emotional aspect of it as well.

To me, the new year is a time for TEARING down everything and rebuilding a new, keeping in mind what worked, being thankful for it. Also to still put some attention on the things that went against you and actually be thankful that the bad things you went through are over, and be thankful that you learned whatever lessons you did from them. If you want to simply piggyback of a timetested method, by al means go for it, however, in my view you should do more than that.

First of all the new year is a time for reflection and to “give thanks” for the amazing things in your life, or at least your desire for a new direction in life and your movement towards bettering yourself and your life. It is more a time of contemplation and restructurion than it is of setting goals. The goals must come AFTER you have restructured your way of life to match more consistently with the things you think you might want.

So if you know you want to be thin, it is not until you throw out your cheeseburgers, start making salads, and get a cookbook that will teach you to make healthy food, and you actually eliminate the thoughts and beliefs that prevent you from becomming a thin person to prevent yourself from a “relapse” and getting caught with your hands in the cookie jar. A resolution is about being, not simply doing.

Most of you are simply trying to pound a square peg through a round hole. You have not changed yourself, nor have you changed your environment, and yet you think you can simply set a goal and acheive it by constantly telling yourself you will. That’s at least a start, but it’s not enough.

Okay, so lets say you want to become a better investor. You have to send yourself a message that “this time it will be different” perhaps while you trade, you do things like wear a robe and walk around in sandles yelling (I am the Almighty Fly) while hurling sandwhiches at a picture of your trader/servant, and listening to mozart. This is something different than you have done I assume. This dramatic change will signal to your mind that “something’s different”. SO you will begin to move away from the status quo, and your mind will begin learning in a new way. Perhaps you move your computer to a new location free from distraction, and have one computer for trading and another for whatever you use it for. Perhaps you buy a new monitor and get a desk. Something needs to be done differently, because if you always do what you’ve always done, at BEST you can maybe expect to continue to be where you are and keep getting what you’ve always got. But if you want to do better in trading, you have to do much more than just “hope” and pray” that suddenly you do better, you have to BECOME a better trader yourself, and give yourself a better trading environment.

Sell out of all your old positions, if not just for the psychological edge. Now you will need to do 1,000 different things.

1,000 things to change.

1-100) 1st eliminate at least 100 distractions in your environment, minor and major.

101-200) Create 100 new behavioral patterns (wake up to some ipod playing some “market update”, listen to classical music while trading, work in new environment, walk around in a suit, change your body language, do whatever you have to do to tell your brain to make a positive change)

201-300) Create 100 new questions to regularly ask yourself. “is this something a successful trader would do, think, eat, etc? Is this helping or hurting my ability to trade? What makes this strategy better? How can I better manage my money, etc”

301-400) Find 100 new resources to regularly use, whether it’s trading software, websites, blogs to read, books you buy and read, etc. Personally I find it much easier to simply set up an RSS feed reader on my iphone and set up all the RSS feeds of several resources I need to look at than to actually visit every blog.

401-500) Eliminate 100 old beliefs that are holding you back, minor and major (I am too impatient, I can’t stay focused, blah blah blah)

501-600) Create 100 new beliefs that will support you and make you do better. (I am patient, etc)

601-700) Reframe 100 limitations to 100 strengths. (if you think that “I’m just a little guy, how can I succeed like Buffet if I don’t have the ability to buy private equity firms like he does?” you need to change it into “Buffett actually did better in the days BEFORE he was confined by having so much money that it’s more difficult to manage, he’s confined to only focusing on large cap stocks, I am a smaller trader, so I have more liquitidy and can be more nimble, etc”)

701-800) Reframe emotional pattern 100 times (If a certain feeling prevents you from succeeding, you have to imagine an environment in which you felt great andhad a winning attitude, and then visualize the situation that used to make you uncomfortable while still spinning that feeling of winning inside of you, ththe mind can’t distinguish between a real and imagined event, so if you train your mind to feel successful when a trade is going against you, you can respond more rationally and prevent your emotions from getting the best of you.)

801-900) Create, make, do, etc 100 new things consistent with the goal (I could take awhile to get into this but basically a successful trader has several things working in his favor and he did several things to get where he is. Within each of those things there’s several more things. Start with a web and branch out, and you will have to do and believe, and feel certain things before you can get to where they are. You must be able to “reset” all of your past, and put yourself in the position that successful people were in. Maybe they had success and confidence behind them, hich built a belief that things would work out, which resulted in them taking action to ensure that it actually would. You have to actually imagine going through these things, or else rely on good trading, luck or randomness to get you there. I would rather not have to rely on experience as that requires winning and losing, and the learning curve would be much steeper and more costly than actually looking at a stocks histroy, what it’s numbers were at the time, what it’s price was, imagine how a trader might feel, imagine buying it, then look at where it went and imagine the feelings that went along with it. Yes,  big part of the game is mental, can you handle it mentally and emotionally, and can you stay away from fear and things that prevent you from doing what you need to when you need to?

901-1000) Create 100 new healthy habits consistent with your goal. There is a link between what you do and see and how you behave, with your thoughts, emotions, goals, etc. If you form the habits of successful people, you will start to think more like them, feel what they feel, and shorten the time it takes to be more like them. Along with this is environment, so maybe take a visit to their hometown and truely emerse yourself in their behavior

Bonus) Create 100 new responses/reactions to events that you anticipate happening.

Bonus) Come up with 100 new “mentors”
Now some of these numbers are too large, it’s better to focus on  the best 10 rather than worry about the full 100, but you may wish to experience the full 100 first, then get an idea.

Narrow down your 100s of things that you have done and focus 90% of effort on the top 10 most important.

For a lot of people this is way too much work, but to them I can only say if you are not constantly evolving you are dieing. If you are not constantly improving yourself, you will not have a life which constantly improves and gets better with it. For many people a full on renovation of their sorry lives is needed. For many people, they are better off picking someone, and “becoming” that person as much as possible.

There are radical techniques that can go along with them making these changes, that can mean anything from NLP and reframing ideas, to hypnosis, to visualisations and affirmations, to having internal dialog with yourself until you adopt your beliefs. These aren’t neccesarily needed, but if that’s what you need to believe that you are going to make a change, and actually rebuild everything you learned, go for it. Maybe you need more greed and less fear, you can do things to work on these emotions that sabotage yourself, but unless you are comfortable with change in the first place, it’s going to be difficult to adapt and become a better trader. You may simply sabotage yourself in another way. Maybe you weren’t picking winning trades, and you learn how, but now yyou risk everything on one stock which does bad. Some people can’t handle the idea of success, it isn’t “who they are”. You can gain an edge simply by engaging in a process of always improveing and getting better. I’m not afraid to risk my rear end on a trade and have it go against me, because that is a process of learning.  I have at times been up large in a single year, and taken all of my profits in a singlestock and bet heavily on an option that is out of the money. Sure it sucked that the stock expired  out of the money even though I was right about the direction, and I had to start back where I was, and I learned to give myself more time on the option. You go back to the grind, but just because you have what you started with doesn’t mean it wasn’t worth it. You learn from those experiences, and your brain actually is forced to start the process of learning in new ways. Failure breeds success if you can get a lesson from it and use it to guide you. But if you don’t have the attitude that everything will eventually work in your favor as long as you keep your eyes on the prize, then you might as well have never have tried in the first place.

While that will add the balance needed, you still need to actually go through the mental process and take the correct physical action to improve your trading. So perhaps you wish to learn to trade options, or you take a few courses in trading, or join The PPT.

If you are going to succeed, you need to go all out. Evolve or die, it’s your choice.