“Published as a column on Toyokeizai ONLINE” Tips for keeping an investment diary
Hello, this is Matsushita.
In yesterday's newsletter,
titled "Advice from the Investment Gods' Teacher",
we introduced the advice of Benjamin Graham,
the mentor of Warren Buffett.
Among this, a similar idea was conveyed about the effectiveness and importance of an "Investment Diary".
In response to that, we received questions from readers,
so I will answer them, and also share some unexpected points about keeping an investment diary.
The question was,
"Are investment diaries, including those on Word or other PC-based tools, effective?"
Recently, there are many convenient applications that can be used on PCs, smartphones, tablets,
and various devices, so the tools people use differ from person to person.
Keeping a diary with different applications on PC, smartphone, or tablet is also
effective.
I am more of a traditionalist who writes on paper,
but there is a common point between diary entries written on paper and those written on PC or smartphone,
can you guess what it is?
That is, using your hands to input information.
When you input information hands-on,
the information and stimulation strongly reach the brain from the hand,
and transmit to the brain.
This is the advantage and meaning of keeping a record with your hands.
Diaries on PC, smartphones, tablets, etc.,
are also fully effective, so please give it a try.
However, recently there are apps that can recognize voice and input information,
but those do not involve using the hands, so their effectiveness is unclear.
Please, make sure to use your hands to stimulate your brain.
Next, tips for keeping an investment diary,
always along with your buy/sell decisions and directional judgments,
record the reasons for those decisions and the mood or emotions you had at that time.
Of the contents you write in an investment diary,
these two are the most important.
And these two are things you will absolutely fail to recall later if you try to remember them,
and this is precisely why losses keep accumulating forever.
Be sure to write down the reasons for your judgments, as well as your mood and emotions.
Lastly, the most important point.
It is "regular review and reflection".
Many people who think, "I keep an investment diary, but the results don't change,"
say,"I just write a diary and never review it afterward,"
and this is common.
An investment diary is not about the act of writing itself, but about changing the results and turning losses into profits.
To achieve this, you must reflect on the losses you are causing,
the judgments and their reasons, your emotions and feelings,
and gradually change them.
Changing these emotions and feelings cannot be achieved in a short period,
so continue keeping an investment diary for 3 months, 6 months, and 1 year, and
take time to gradually change your thinking and actions.
By doing so, you will acquire thinking and actions that lead to profits and
turn losses into profits.
The practice began about 16 years ago,
in the first year after I started investing,
I began keeping an investment diary, and around after a year,
I transformed into an investor who makes profits.
1. Investment diaries stimulate the brain by using the hands.
2. Investment diaries must include the reasons for judgments and emotions.
3. Investment diaries should be reviewed regularly to change your thinking and actions.
These three are the tips for keeping an investment diary,
and they are also tips that only those who have actually done it would understand.
I will say it again and again,
to increase your profits,
you must keep an investment diary.
Here is the investment diary I authored and supervised.
