Experts agree this one habit is essential to investor success

by Mar 28, 2018All Articles, Education

Maintaining a trading journal, while not a new concept, has evolved over the years from a pen and pad to detailed portfolio logs of every entry and exit made. It’s something I have long believed to be an essential component for investors new to the stock market to use. It allows you to go back to the start of a trade and analyse what you were thinking at that time for both the wins and the losses.

However, while reading a recent post from Jeffery Tie – Aiki Trader between one of his students and Mark Shawzin, I realised the benefits of maintaining a trading journal are not limited to those new to the market. In fact for some seasoned traders, the need to keep a journal can increase over time…

I failed.  I’ve actually failed MANY times when trading, so let me be a little more specific. The last time I completely failed was in 2011/2012. I lost about $300,000 all because of one stupid thing.

You see… usually I keep a journal of every single trade.

So before I finally pull the trigger, I take a screenshot of the chart, write down my analysis, and figure out the exact entry and risk. And then I enter a pending order.

I rarely, if ever, enter a live trade. This takes away a lot of the stress in trading AND it lets the market confirm my entry by moving through it. To lose the $300k all I had to do was stop the journal.

I had been keeping one for years and then I got complacent. Everything changed in an instant.

All of the sudden I was an emotional, amateur trader, who couldn’t make a buck in the markets.

At the time I had 29 years of experience and 23 of them was spent trading the accounts of high net-worth individuals on Wall Street.

So it was amazing to me that by changing one simple thing made me no better than an internet trading newbie.

Since then my account has more than recovered the loss and it is all because I kept a journal.

Mark Shawzin


The effect a trading journal could have for an investor who had been around for many years intrigued me. Jeffrey Tie also mentioned in the same post that he also maintains a trading journal. So I contacted him to ask what benefits he found by using a journal…

There a few good reasons why I use the Journal function embedded in Optuma:

  1. The major reason is to guard against “selective memory”. I have many faults and foibles, one of which is a tendency to remember spectacular winning trades and ignore the losing trades that have used the same strategy. Keeping a trade journal helps me guard against my own weakness, and the journal provides an unbiased record of all my trades, as long as I maintain the discipline to write the journal just before trade execution.
  2. Keeping the journal allows me to inculcate discipline into my trading approach, and the discipline I practice with the journal will also enhance the discipline required to execute trades according to my trade plan.
  3. Optuma makes it so easy to keep journals. More importantly, these journals will never be erased.
  4. One very good feature of the Optuma journal is that if I trade a stock, index or commodity, I can immediately see my previous journals that have recorded what I have done in the past with the same stock/index/commodity.

The Optuma journal includes:

  • the text only record where I write down the conditions the market has met for me to execute the trade
  • the chart showing the market at the time of trade execution

I find that this simplifies the creation and maintenance of my personal trading journal.

Jeffery Tie

Aiki Trader

Beginning to see a pattern emerging, I wanted to know more. From past conversations I had with Ray Barros (a professional trader of many years, author and educator), I knew he believed keeping a journal was important. I asked if he could sum up why…

The tripod for trading success:

Mind x Money x Method = Positive Expectancy Return (Trading Success).

Mind covers two aspects:

  • Consistent Execution, and
  • Constant and Never Ending Improvement (C.A.N.I.)

Keeping Equity and Psych Journals are key tools. The Equity Journal provides the quantitative data (the stats), and the Psych Journal provides the qualitative (the insights).

All successful traders with whom I am acquainted keep and use both tools.

Ray Barros

BarroMetrics Investments Inc

With so many market professionals not only advocating their students to maintain a trade journal, but still using a journal themselves, it is clear the Journaling System within Optuma is a powerful feature for anyone wishing to implement this habit of successful investors.

The process of maintaining a trading journal within Optuma is fast, efficient, and easy to maintain. Entries can be as long or as short as you like, and can include snapshots of the chart and indicator setup you are reviewing at the time. Information entered into the Optuma Journal can even be displayed within your Watchlists—perfect for quickly reviewing your current portfolio.

If you’d like to start using the Optuma Journaling system, the best place to begin is by watching the following video.

Note: the next Optuma update (beta version coming soon!) will include the option to display journal icons on the chart so they can be accessed quickly.


Optuma Trading Journal

Share Link
Matthew Humphreys

Matthew Humphreys

Client Services & Product Director

Matt Humphreys is the Product Manager at Optuma. Starting out in the Customer Service section with 1st level support, he now has over 10 year's experience in assisting traders with technical issues. This has given him a unique perspective on what is needed to streamline computer systems to maximise the benefits that technology can provide.

1 Comment

  1. CB3

    This was a terrific overview.


Submit a Comment

Your email address will not be published. Required fields are marked *

Blog Signup

Pin It on Pinterest

Share This