Keep track of your trades and analyze your performance from "summary" of Reminiscences of a Stock Operator by Edwin Lefevre
It is of utmost importance for traders to keep a detailed record of all their trades. By doing so, they can gain valuable insights into their performance and decision-making process. This record should include not only the trades themselves but also the rationale behind each trade, the market conditions at the time, and any emotions or biases that may have influenced their decisions. Analyzing this data can help traders identify patterns in their trading behavior, both positive and negative. For example, they may notice that they consistently make profitable trades during certain times of the day or week, or that they tend to hold onto losing trades for too long out of fear or hope. By recognizing these patterns, traders can adjust their strategies accordingly and improve their overall performance. Furthermore, keeping track of trades can provide traders with a measurable way to track their progress over time. They can set specific goals for themselves, such as achieving a certain percentage of profitable trades or maintaining a certain risk-to-reward ratio, and then monitor their performance against these benchmarks. This can help traders stay disciplined and focused on their long-term objectives. In addition, analyzing past trades can also help traders learn from their mistakes. By reviewing losing trades, they can pinpoint where they went wrong and take steps to avoid making the same errors in the future. This process of self-reflection and continuous improvement is essential for long-term success in the market.- By keeping a detailed record of their trades and analyzing their performance, traders can gain valuable insights, track their progress, and learn from their mistakes. This disciplined approach to trading can help them become more consistent and profitable over time.
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