The importance of maintaining a Trading Journal

Updated: Nov 19

Track and analyse your trades like a professional

The most essential yet overlooked aspect of trading is maintaining a trading journal. Most new traders think of it as an unnecessary chore when they are making money, and as a guilt avoidance measure when they are immersed in losses.

It’s the last thing on the priority list for most unsuccessful traders but the first thing for the most successful, consistent, and disciplined traders.

The Importance of Maintaining a Trading Journal

A trading journal is a detailed account of a trader’s trade. A trader puts in all the information of the trades taken, which could include the emotional state, the chart set-up, fundamental factors, entry points, position size, stop loss, expected reward, the day and time of the trade, and the end result of the trade. It has to be analysed regularly, highlighting the strength, weaknesses and viability of a trading system.

I provide a weekly report in our forum of all the trade details, rationale, performance history, market summary, and every trade is recorded going back 7 years. It is this kind of detail you need.

Such detail helps hugely with psychology, discipline and expectation, and all three are deeply entwined.

My Journaling:

Although I'm an excel geek and all of my analysis/records are born through it, I recommend Edgewonk and their software which will chart and breakdown all you need to know from your own trades.

Be sure to use the code FWISDOM for a discount

I also offer a number of free trading spreadsheets and tools HERE

Let's discuss the points underscoring the importance of a trading journal.

A discipline instillation tool

Discipline is the most important aspect of successful trading as it is for any other business.

The best and most successful businesses have some parameters to track the success of a project they undertake. Those trackers are reviewed regularly to assess the progress of the projects, the good projects often continue while the poor ones are dropped.