Journals are a requirement for traders, however, if you are not recording p/l data for trades within your system AND p/l data for trades outside your system you are missing the most essential ingredient in a journal.
First you must have a clearly defined strategy that is rigid, so recorded data becomes meaningful. In earlier trading years I perhaps was mildly satisfied with an overall p/l of 20% annualized. Once I separated my p/l for trades inside the system and those outside the system, and discovered trades inside were delivering 65% annualized and those outside were losing money - my trading light went from dim to bright. This was the trigger that moved me from a casual trader to an aggressive one, who understood that a consistent strategy was required for success. This also led me to positive actions that resulted in measurable improvements in my strategy.
I still trade outside my system in an attempt to identify improvements, but all serious money stays within the boundaries of my over all rule set.
Drake
First you must have a clearly defined strategy that is rigid, so recorded data becomes meaningful. In earlier trading years I perhaps was mildly satisfied with an overall p/l of 20% annualized. Once I separated my p/l for trades inside the system and those outside the system, and discovered trades inside were delivering 65% annualized and those outside were losing money - my trading light went from dim to bright. This was the trigger that moved me from a casual trader to an aggressive one, who understood that a consistent strategy was required for success. This also led me to positive actions that resulted in measurable improvements in my strategy.
I still trade outside my system in an attempt to identify improvements, but all serious money stays within the boundaries of my over all rule set.
Drake
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