Why prop traders need a journal even more
On your own account a rule break costs money. On a challenge or funded account it can cost the whole account. Most accounts aren't lost through one bad setup, but through a moment of frustration, oversizing after a loss or trading through news you should have skipped.
Those are behaviour patterns, and they only become visible when you record more than your results.
Know your rules, and write them down
Every firm has its own rules. Write yours down in your journal before you start, in your own words:
- Daily loss limit and maximum drawdown, in money
- How the drawdown is calculated, for example from balance or from the highest equity
- Profit target and minimum number of trading days
- Consistency rules, if your firm has them
- Restrictions around news, holding overnight or the weekend
What to record for every trade
On top of the usual fields, prop traders benefit from a few extra ones:
- Risk in money and as a share of your daily loss limit
- How far you are from your daily limit and your maximum drawdown after the trade
- Whether there was high-impact news around the trade
- How you felt at entry, especially after a loss
- Whether the trade fitted your plan for the day
A daily routine that protects the account
Before the open, check the economic calendar and decide which times you won't trade. Set a maximum number of trades and a point at which you stop for the day, well before the firm's limit. Log each trade while you take it, including how you feel. After the close, write down whether you followed your rules, separately from whether you made money.
The weekly review
Once a week, look at your rule breaks, not just your result. On which days did you come close to your limit? What happened just before? Which setups and times keep you comfortably inside the rules? Use that to set one focus for the coming week.
Mindset under pressure
Challenge pressure changes how you trade. Many traders take more risk when they're close to the target or try to win back a loss straight away. Write down how you feel before and during the trade. After a few weeks you'll see exactly which moods go with your rule breaks.