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13
Jan

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How to improve your journaling routine – 3 simple questions

According to Dr. Brett Steenbarger, one of the most well-known trading psychologists, traders are too negative when it comes to journaling. Only focusing on the negative aspects of trading and using a journal to talk mainly about losing trades can create a negative environment for your trading.

In a different article, he highlighted that traders mostly keep a trading journal when things are not going well and once they hit a winning streak, their journaling practice gets neglected. This again means, according to Dr. Steenbarger, that traders focus mostly on problems and not on solutions. Journaling winning trades and during times when things are going well could help the trader find ways to leverage his/her strengths. 

In a podcast, Dr. Steenbarger provided three questions and tips when it comes to positive, solution-based journaling:

 

1. What’s the one thing I did best today?

Although it is important to work on your weaknesses, exclusively focusing on them will create a negative environment for your trading. At the end of the day, find the one that you are really satisfied with. And even during tough times or during losing streaks, find the thing that stands out in a positive way. It does not have to be a big significant finding, but priming your mind to look for the good can make a big difference.

It may be as simple “I woke up early to prepare my trading plan. Otherwise, I would have taken bad trades if I’d been unprepared”. Or, you can go into strategy specific concepts that you want to highlight.

 

 

2. What’s the biggest mistake I made today that I am going to make a concrete effort to change or improve tomorrow?

For this point, you want to be as specific as possible. Many traders are too vague and they just note things like that the “lost money” or “broke their rules”. However, such observations do not lead to actionable change.

Here, the key is also to focus on one thing only. Don’t try to change your whole trading at once but make targeted adjustments one at a time. 

 

3. How am I going to do that?

With this question, you can see why you need to be specific during point 2. You need to develop actionable goals that you can implement right away in your trading. 

 

How to use Edgewonk for that:

Although Edgewonk comes with a lot of metrics and statistics, the Sessions tab will help you journal manually in an effective way. Every day/week/month, you can create a new session, write down your notes and the lessons you learned during that time.  The Sessions tab also provides a quick breakdown of your overall performance for that time period. 

Entering a new session takes just a few moments and once you have built a record of multiple sessions, you can effectively follow your thought process and your mental path over the months. 

You can see what differs in your thinking when it comes to losing and winning periods at a glance and then replicate the positive mindset.

(You find the Sessions tab under Trade Process)

 

As with everything when it comes to journaling, don’t overwhelm yourself. Take 5 minutes each day or at the end of the trading week, look back and write your observations down. Most traders can’t keep up their journaling routine because they make it too complicated and they force themselves to write long essays. 

Asking three short and simple questions per day can have a huge impact on your trading long-term. 

 

Happy journaling

 

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