I'm sure you've heard the phrase, "Write it down." But if you're like me, that's easier said than done. For years, I avoided keeping a trading journal and instead relied on my memory to recall past trades and their outcomes. It wasn't until I started writing things down that I realized how much better off I'd be if I had a record of my trades—and not just an account statement—to study. And guess what? Keeping the best spiral bound journal for trading can help you make better decisions when it comes to time for your next trade!
Profit/loss from the trade
It's important to record how much profit or loss we made on a specific trade. It will help us see if that strategy is working for us and if it's worth continuing.
How could I improve on this trade? Sometimes we make mistakes in our trading, even if we've done everything right by following our plan! A journal entry like this can help us reflect on where things went wrong and how we can fix them in future trades.
If a particular strategy has been successful consistently over time, then writing down why that occurred can help ensure future success too!
Entry and exit prices
It's important to keep track of the price you entered and exited a trade, as these are key factors that influence your success. You can also use this information to determine whether or not you should have gone into or out of a trade at any time during its life cycle.
To record entry and exit prices in a journal:
- At the bottom of each page, write down today's date and write "Start" across the top above it (see image for reference). This will serve as an indicator that this page is filled with entries related to today’s trades—you may want to make sure this column is wide enough so that you can fit more than one word per cell if needed!
- Write "Trades" across another row beneath today's start date, right underneath where we put “Start” above it before heading into our first trade!
Most traders find it helpful to keep a journal of their trading activities. This can be as simple as a sheet of paper or an Excel spreadsheet, but what goes into your journal depends on what you want out of the experience.
A good starting point is to include all the details about each trade: entry price, stop loss level, and a profit target price (these are examples only; you may choose other parameters). If possible, also include the time stamp for each event so that your entries and exits can be analyzed in relation to news releases or other market events.
Once you have recorded these basic details over time, analyze them by looking for patterns in your behavior as well as potential opportunities for improvement. For example: Do certain trades tend to fall at certain times of the day? Does one specific pair seem more volatile than others?
Thoughts and feelings leading up to the trade
When you trade, what do you think about it? What do you feel in your body? What is the reason behind your decision to enter the trade?
Think of it as a way of tracking your own thought processes, so that if something goes wrong, there's no question as to why it happened. When writing down these things before starting a new trade journal entry, try to be neutral and honest with yourself—no beating up on yourself or berating yourself for making bad decisions! The goal here is just to learn from mistakes so they don't happen again.
Action plan for the next trade
Finally, it's important to include in your journal the action plan for the next trade. This should include what you learned from the previous trade and what you'll do differently next time. It should also state your goals for future trades.
What is important is that you're able to look back on your trading journey and see where you've been and how far along the path of becoming a successful trader you have come.
Emotional reflections after the trade
It's also important to use a spiral binding notebook to make note of your emotions. How did the trade make you feel? What were the emotions that you experienced during the trade? Do these emotions affect how you trade or how well you perform in general? After completing a trade, how do you feel about it? Do you have any regrets or wish that you'd done something differently?
The answers to these questions can help paint a picture of what is working for and against your trading and help shape strategies for improvement.
A stock trading journal is one of the most important things to your success as an investor. It’s a way to keep track of your trades and how they went so that you can learn from them and make better decisions in the future. It should be something you do every day, even if only for five minutes at a time!