Do You Keep a Trading Journal?

One of the most powerful tools you can have in your trading arsenal is documenting all your trades in a journal. How else can you learn and grow as a trader, than from the positions you take? Also it's critically important to periodically review your journal, to analyze your successes and your failures, and understand why you made weak trades, so that you can avoid these errors in the future, and note the things you do well, so you can leverage these strengths going forward.

You can document your trades in any number of ways, say within a Word document or a blog. Some people find using a spreadsheet a powerful tool, as you can apply simple formulas to provide an empirical view of your performance. Here are the things you should put into your journal:

The market conditions that existed at the time of the trade

The reason you entered and exited the trade, the time and price

Was it a long or short trade

The market conditions at the time of the trade, through to the time you closed out

The position size and how you managed it during the entry/exit life cycle

A chart that shows your analysis, and the conditions that you felt justified the trade

Notes on any other market conditions, news, or events that made the trade attractive