Thread by @theBuoyantMan

Journaling is a very important thing to do if you're a trader. It serves the following purposes:

- Helps identify patterns in your trading behavior
- Helps identify high-impact mistakes to fix
- Helps to understand where you're losing most money
- Helps in refining your edge.

Journaling your way to success isn't a new concept. It's been done for years now and has been practiced and advised by many millionaires, billionaires too.

Different kinds of journaling serve different purposes. There are two major ones that I follow I'd like to suggest here.

The first one is the one that I learnt from @GrantCardone.

Just before going to bed, and immediately after waking up - write down 10-15 things that you want to have achieved for yourself and your life in the future.

Write them in the present tense as if you already have them.

Without getting into the esoteric law of attraction/intention aside, doing this type of journaling keeps you ON TRACK in life.

The worst thing that happens to many people is DRIFTING.

They just drift aimlessly, because it's easier to forget your goals and dreams.

It's easier to just do what's immediately important without paying much attention to the life you're building for the future.

So, this journaling practice reinforces what your major goals are, when your subconscious is susceptible & open to suggestion (before & after sleep).

The second kind of journaling I do that I would suggest you do too, especially if you're a trader is as follows:

Record the following things about your day in an excel sheet.

Make 2 sheets. One for trades, other for day's parameters.

In the trade related sheet, record the following items.

- Planned trades (entry, exit, stop losses)
- Trades taken (entry, exit, stop losses)

Brief summary of

- How you felt before trading
- How you felt after trading
- What kind of mindset/feeling during the market start

Also record what your bias for the day was, what your reasoning for that was, etc.

These are applicable for every style, doesn't matter if you're systematic or discretionary or rule based discretionary trader.

For winning as well as losing trades, note down whether trade went according to plan, or whether you introduced discretion and changed the plan. This will be highly helpful later on.

In the second sheet that you use to track your day's parameters, track the following.

- If you exercised that day
- How many hours of sleep you had the night prior
- What you ate in the morning
- What you ate prior night
- What kind of feelings you have on start of the day

Also add the following things:
- Whether you were physically tired
- Whether you felt mentally fatigued
- Whether you are able to concentrate well and felt fresh or exhausted and unable to concentrate
- Whether you had a fight/argument with your spouse/kids/parents/boss/team

In addition, you can also track the following things:

- Were you hungry or sleepy during the trading hours
- When you have your lunch
- Which location you traded at
- How was the climate that day
- Woke up early or late
- Feeling sleep deprived or well rested
and so on.

This may sound like exhaustive work, but no one told you that being a trader is easy. I have heard of such exhaustive journaling happening in many prop firms abroad.

Over a period of time, this journaling done right, gives you vast amount of data about yourself.

Using the data you generate, you can then find patterns, and start fixing your in-trading behavior with in-trading execution issues + outside of trading lifestyle issues.

For ex: You can combine the two sheets' data and identify patterns on what kind of breakfast in the morning helped you feel fresh throughout trading day. How much sleep on average you had during the nights prior to really good and positive winning trades.

You can also identify whether having any bitter arguments or fights had a direct impact on your execution, whether it nudged you to have a lapse in executing your plan or doubting your entries/exits.

You can use that data to identify whether you perform really well before lunch or after lunch; whether you perform well during days you have lunch, or days you don't have lunch; whether your changing your original plan leads to more wins or losses, impact of your biases, etc.

Doing this over a year or two at least gives you droves of information to play and work with in improving yourself as a trader and bringing your A-game on, with the right lifestyle adjustments, and execution adjustments.

Using at least two years of data, you can analyse the statistical significance of one or a combination of these factors with respect to your trading results on a daily, weekly, monthly, yearly basis - and decide which adjustments to make in your behavior, lifestyle, execution.

Trading is not an easy profession. It's where your subconscious can wreak havoc in an instant if you aren't self-aware. The most successful traders are also the most self-aware people.

The most self-aware doesn't mean good, positive, or optimistic, but they are aware of their own biases, negative traits, limiting beliefs, self-sabotaging behaviors, etc. That's very important to consciously recognize as part of becoming a better trader.

If you don't consciously work out what you want played out, your subconscious script will execute on auto-pilot and you won't have control over what happens. You will silently watch in despair as you sabotage your own trading, lose whatever you made, and question your existence.

Nobody said trading was an easy endeavor. As @yogeeswarpal once tweeted, trading is the most difficult way to make easy money. I don't know about genius traders, but if you're an average joe and you want to become a successful trader, embrace journaling.

Start with excel and customise things, or get a journal software like Edgewonk and use the prebuilt templates. Do what you may, but don't take journaling lightly. It's LITERALLY the one factor that will aid you greatly in your process to achieve peak performance as a trader.