Page 1261 - How to Make Money in Stocks Trilogy

More Tips and Tools for Getting Started Right 243

Improve Your Results
by Improving Your Records

“You can’t manage what you don’t measure.”
—W. EDWARDS DEMING

Your online broker keeps a basic record of your trades—purchase price,
number of shares, etc. But to systematically improve your skills and returns,
you’ll want to personally keep a more detailed account of every buy and sell.
As you’ll see, it’s very easy to do, and the payoff is definitely worth the extra
little effort.
As we just saw, regularly reviewing your trades is essential to your suc-
cess. Having good records of your trades makes doing that review so much
easier and faster.
Plus, writing down your reasons for the trade at the time you make it will
help prevent rash buy and sell decisions. It forces you to step back and make
sure you’re sticking to the buying and selling checklists. Trust me—you’ll be
a lot more confident and comfortable if you have a sound rationale for mak-
ing that trade before you make it.
Here’s a simple way to keep a snapshot of what each stock looked like
when you bought or sold it. If you follow these steps, you can always go back
and see what the chart action, ratings, earnings and other key criteria looked
liked at the time of your trade.

Tracking Your Buys

Every time you make a buy, print out the following for each stock:
• Daily and weekly chart
• Current IBD Stock Checkup

You can print these out and keep them in a binder. I prefer to create PDF
documents and store them on my computer. I find that easier to organize,
but the format doesn’t matter. Do whatever works best for you. What’s
important is that you keep a detailed record of what was happening with the
stock at the time of your purchase.