Emotional Trading

Are you keeping a journal? We get it - stock trading and journaling seem like they’re on the opposite ends of the spectrum, but we’re here to tell you that that’s just not true. Keeping a journal is the one thing you need to do if you want to be a successful stock trader. Think about it this way - all businesses keep a record. As a stock trader, you are your own business. It’s important that you keep a record of your wins, your losses, and your bank account. But keeping a journal is more than just tracking your performance metrics. Journaling helps you recognize patterns, inventory emotions, and build your confidence. In fact, actually writing in a journal can help remove the stress and mental blocks that are affecting your trades. Take a look at some of these other benefits of keeping a journal: 

• reduces depression and anxiety
• cultivates gratitude
• helps with recovery from trauma 
• strengthens emotional function
• keeps memory sharp
• improves self-awareness and confidence
• enhances learning and development

Your personal journal will reflect and shape your reality, and we go into more on how this works in this episode. For example, if you keep a journal when trading, you’ll be better able to define your strengths and weaknesses more clearly. You’ll know where to make improvements, and it will help you set better goals that will keep you away from those questionable trades.  Successful stock traders keep a certain kind of journal, and we go into the different ways you can journal to get the most out of the experience. We discuss which apps to use, which metrics to measure, and also which patterns of emotions to track. There’s more to keeping a journal than you think, and we’ve put together a list here that will help you get a headstart on this episode: Which Performance Metrics to Track:

1. Asset traded
2. Position size
3. Time/date and entry/exit price
4. Screenshots of the trade
5. Notes and performance grade
6. Emotion tracker

Which Patterns of Emotion to Track: 

1. Negative thinking
2. Impulsivity
3. Fear

The most important thing to remember when keeping a journal is to track your emotions before, during, and after the trade. We share techniques on how to do this and what to look for so you can keep an emotional inventory in real-time. Journaling like this has the power to shape healthier environments for our bodies and our minds, which makes it crucial to successful trading. At the end of this episode, we want you to start keeping your own trade journal. Consider your journal as feedback on not only your techniques but also on the patterns in the market. Too many stock traders don’t take the time to master a technique, but if you start keeping a journal right now, you’ll be well on your way to becoming a real success story in this industry.  In This Episode You Will Learn

• The one thing you need to be a successful trader 4:51
• How to write a solutions-focused journal 17:02
• Some of our biggest emotional triggers on the trading floor 28:05
• The ways journaling can improve your trade performance 42:33
• Our favorite ways to keep a trade journal 44:35
• The three patterns of emotion traders should track in a journal 54:00

Some Questions We Discuss

• Why is the failure rate so high among traders? 3:29
• What are the benefits of journaling? 9:23
• How do these journaling benefits work for traders? 22:10
• How can journaling keep you out of questionable trades? 37:23
• What should traders actually be journaling about? 48:01
• What is the most important element of a trader’s journal? 49:37

Resources

• Connect with our community online: Trade Pro Academy
• Catch up with our earlier episodes: Mind Over Markets Podcast
• Check out these journaling insights: 'Trade Journals that Work' by Dr. Brett Steenbarger 
• Here’s the journaling process: YOUTUBE LINK
• The book that Mark keeps re-reading: Think and Grow Rich by Napoleon Hill
• Try journaling with these resources: Evernote, Google Docs, Microsoft OneNote, Tradervue, Verbal Journal