- : September 26, 2021
- : B. Krishnakumar
Measure, Manage & Improve
I have talked a lot about this topic earlier and feel there is nothing wrong in reiterating this important concept. Yes, I am referring to recording your trades, monitoring, and reviewing them in order to identify mistakes and improve your trading.
Simply stated, I am talking about maintaining a trading journal and more importantly reviewing them consistently. From my personal experience, I can share these aspects which prevent consistency in maintaining records.
Unwilling To Face Reality:
This I feel the primary aspect that prevents someone from maintaining a trade journal. The fact is that the trade journal reflects your performance and acts as a scorecard or a mirror reflecting the reality. If you do not have a trade plan and/or are undisciplined, it is very likely that you would not have the inclination to maintain trading records. This is natural as the trade journal will throw up losses and you are definitely not willing to face it.
The consequence of not maintaining a trading journal will most likely be a gross failure as a trader. You will keep committing the same mistake over and again and time will fly by without you even realising it. Suddenly, when you introspect, you will realise that you have spent ‘N’ number of years in trading/investment and there is nothing to show as returns.
This is criminal and please do not get into this state. So, buckle up, get started with maintaining your records. It is not sufficient to just maintain records. The records should provide meaningful insights which can be used to identify mistakes & help you improve as a trader.
But for this, you first need to maintain a meaningful trading journal.
Let us discuss other aspects related to trading journals in subsequent weeks.