Plan The Second Half Of 2023 In 2 Simple Steps

Believe it or not, we’re halfway through 2023. How has your trading performance been? Ideally, you’ve been conducting your monthly performance reviews and have a good understanding of where you sit. Ideally, we’re at least halfway, if not slightly beyond, our annual performance targets. The goal of this post is to help you analyze your YTD performance and create a path forward for the remainder of the year.

2023 YTD Analysis

We need to take a look at the primary trends of 2023, both the market as a whole and your individual performance.

For the broad market, what did you see? If you’re unsure of where to start, checkout the list of Q’s below:

• How did the broad indices do? Which ones led? Which lagged?
• Within the S&P 500, what sectors led the index? What sectors fell to the bottom? This is how we can create an understanding of what sectors are leading and which are lagging.
• What did broad market volatility look like? Using things like the VIX for the S&P 500 and the individual volatility for the products you trade is a great benchmark.

For Individual Performance

• What is your YTD return? How is your progression towards your 2023 goal? What worked well and why? What didn’t work and why?

• Having both a written trading plan and strategy outline are essential to conducting a thorough, objective, quantitative analysis of your performance. For ideas on what these may look like, you can check out this video: Trading Plans: https://youtu.be/feFqr3W98SM; Building a Trading Log: https://youtu.be/RlVFyXLnhi0

Strategy Adjustments & Path Forward

• Based on what you observed from Step 1, this is where we can chart our path forward.
• I would begin with a broad market hypothesis, coupled with metrics to track validity. For example, leading into the end of 2023, I’m expecting a generally sideways trend, with ebbs and flows, that will be primarily catalyst driven. This informs the style of trading I will employ.
• Next, I would take a look at what strategies have been working well and assessing if they fit my broad market hypothesis. To this end, short 0DTE SPX volatility strategies have worked well for me post March, as the markets have found legs and daily moves have significantly contracted. While this remains the case, I will continue to deploy those strategies.

While we can significantly build out this process, I feel this is a great starting point for those who may lack meaningful analysis in their approach. As always, if you have any questions, shoot me an email: erik@esinvests.com and don’t forget to Be an Outlier!

-Erik

Erik is a Marine veteran, stock market trader, real estate and angel investor. He became a first generation millionaire before 30 through saving, investing, and creating more income streams. He began trading in 2007 and has spent over 30,000 hours honing his craft. He primarily trades derivatives and has consistently outperformed the market. You can learn more about him at his webpage: www.esinvests.com or check out his YouTube channel: www.youtube.com/esinvests.

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