All About Trading Journals

Image result for All About Trading JournalsAs a full-time day trader now for nearly seven years, I know how much better, easier (and successful) trading life can be when you abide by your own personal trading plan, and have a means to record, track and analyze every move you make.You may want to check out for more.

Just recently, I was asked my recommendation on whether or not I would start my trading journal over as we were approaching the new trading year. Here was my (edited) response…

There is no imperative need to start another new sheet (or journal), especially if you have been diligently analyzing your trades and adjusting your trading plan from the findings of your results. If that task is up to date, then I would tell you to keep doing what you’re doing and keep adding crucial data to the same sheet (or journal) you’ve been using. If you have not been keeping up with regular intervals of trade analysis, and you’d like some ideas for adjusting or fine-tuning your journal analysis, then please keep reading.

Let’s first remind ourselves of why we are keeping a trading journal in the first place.

This trader is using the Trading Journal SpreadsheetTM, so it will be assumed that whatever program the reader is using, also tracks various performance-tracking segments to analyze overall performance.

Since analytical stats should all work synergistically with one another, monitoring these stats over time would allow the trader (or in this case, the trade-tracker) the following benefits:

-Discover correlations

-Maintain successful Strategies and Tactics

-Identify unsuccessful Strategies and Tactics

-A means to confirm consistency of results and performance

-Recognize Mistakes and Errors that are causing present-day losses – unlocking future profits

-A warning that something is wrong, when your ratios vary significantly from historical averages

-and of course… Improve on this knowledge!… by periodically adjusting your business/trading plan

Note which of your Performance-tracking categories had a positive expectancy and add those to the new sheet (or journal). For those categories that did not produce a positive income, look at those specific trades to find if there was a common denominator that produced the net losses that you incurred. If using a spreadsheet, you can use the Auto-filter feature, sorting just those specific trades, then reading your entry and exit notes, looking for similarities that brought on the losses.

Better yet, if you hyperlinked (or saved hard copies of) the charts of each trade, compare your notes to what really happened on the charts, and especially make sure you compare them to the notes of your trading plan. I try to review all of my trades about a week after they occurred, when the trade is long over and any emotional biases of subsided.