How much money can I make?
This question, of course, is in the forefront of every trader’s mind. And, it is an extraordinarily difficult one for the novice trader to answer because of the many variables that can affect earning potential and because the novice trader has no frame of reference with which to establish realistic goals. So, the better question to ask is:
How can I formulate realistic expectations?
With your focus on realistic expectations rather than how much your bank account might swell, you would be wise to take these factors into account:
All of these elements are critical components in determining reasonable expectations. This is a good time to revisit your Trade Plan and consider whether you have set reasonable and realistic expectations for your trading at this point.
It is extremely important to recognize that it will take time to become successful. We went over this is some detail in Building a Trading Plan but it bears repeating. Why anyone would think that becoming a competent professional trader is a quick process is hard to understand. Take a hint from Michael Jordan, arguably the best basketball player ever, on how failure plays into success: “I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. 26 times, I’ve been trusted to take the game-winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.”
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