BarroMetrics Views: Journaling and Trading Success IV
My reply to Daisy brought not a few e-mails to my inbox all requesting the same info. Rather than answer the requests individually, I am posting my reply here.
Let’s set the context for this blog. It suits me - the journaling format I wrote about in yesterday’s blog. It may not suit you. Like trading plans, journals are trader specific; beyond the journal achieving the outcome of behavioural change, nothing is set in stone. It’s your personality that counts, so you choose whatever format helps bring about the changes you want.
If you are resistant to journaling, and want to establish the habit, there are two steps I can recommend:
- Create the motivational context for it: Write down a goal that is slightly out of reach e.g. a challenging goal like: I will keep a daily trading journal for the next 30 days. Brainstorm the benefits of journaling and then reframe the goal to one that generates some fizz e.g. Daily Journaling to Trading Success in 30 Days!. Print out the jazzed up version and place it where you will see it consistently. Start the morning and end the evening with the fizzed up goal - treat it like an affirmation - say it out loud with passion and excitement.
What you are doing here is creating new neural pathways. An even more effective way of doing this is to visualize the goal. Create a picture of the FIZZ; then shift into a relaxed mode (shut your eyes). In the relaxed state, bring up the picture of the goal, see it as attained and at the same time feel the great feelings you have because you have attained it. You don’t need to spend too much time on this - just enough to relax and visualize.Visualization has been proven to be most effective way to create new neural pathways.
- The second step is to follow through with the journal keeping. Like going to the gym, the hardest step will be to start. So, make it easy on yourself. Begin with a simple process. This is where the 3-1-0 format comes in. Give yourself:
- 3 points for entering AND exiting the market according to your plan
- 1 point for exiting OR entering the market
- 0 point for entering and exiting OR not taking a trade when you know your plan called for the trade.
The aim is to score 90% of the maximum points. Let’s say your plan called for 10 trades in the past month. You are looking to score 0.9 x 10 x 3 = 27 points. If your journal reflects only 20 points, then you know you have an issue with following the plan you have created. The journal has raised your self-awareness. The next step for you is to evaluate and take steps to change that behaviour.
Refer this blog post to a friend or colleague…
