Learning Through Logging - A Framework for Investment Growth

One of the things I've noticed in my years of teaching investors is that most people want to jump straight into making money. They focus on finding the next great trade or discovering the perfect stock. But very few focus on what actually makes you wealthy over time - having a systematic process for learning and improvement.

The greatest investors I know - from Buffett to Munger to Lynch - all have one thing in common: they're learning machines. They have systems for capturing knowledge and building on their experiences. Today, I want to share my framework for learning through logging.

Why Logging Matters

First, let me be crystal clear - if you're not logging your trades and investment decisions, you're throwing away one of your most valuable assets: your experience. Every trade contains lessons, but without a system to capture them, those lessons evaporate like morning dew.

I'll give you a real example. When I was developing my special situations strategy in 2023, I meticulously tracked every trade. Not just the entry and exit prices, but my entire thought process. This wasn't just record-keeping - it was building my playbook. When opportunities dried up in one area, I had a complete map of what worked and what didn't. That's how you build real edge in markets.

The Framework: What to Log

Here's exactly what you should track for every investment:

1. Pre-Investment Analysis

• Initial thesis (Why are you making this investment?)
• Valuation work
• Expected value calculation
• Risk assessment
• Position size rationale
• Planned exit points/scenarios

2. Trade Execution

• Entry price(s) and dates
• Position size
• How you scaled in (if applicable)
• Commission costs
• Any relevant market conditions

3. During the Investment

• Major thesis changes or updates
• News that impacts your position
• Changes to risk assessment
• Position adjustments and why
• Emotional state during volatility

4. Exit Analysis

• Exit price(s) and dates
• Reason for exit
• Whether thesis played out as expected
• What you learned
• What you'd do differently

How to Get Started

Don't overcomplicate this. Start simple:

1. Create a basic spreadsheet with these columns:

• Date
• Ticker
• Entry Price
• Position Size
• Thesis
• Risk Assessment
• Exit Price
• Lessons Learned

2. Add a separate notes section for each trade where you can write detailed thoughts.

3. Review weekly and monthly. Look for patterns.

4. Grade yourself honestly. I use an A/B/C/F system for my trades based on process, not outcome.

Advanced Tips

Once you have the basics down:

1. Track your emotional state during trades. Are you making decisions based on FOMO? Fear? This data is gold.

2. Calculate your "batting average" on different types of setups. Example: In special situations, I know my win rate on tender offers vs merger arbitrage.

3. Use screenshots. I save charts of my entries and exits. Visual records help pattern recognition.

4. Create separate logs for different strategies. My approach to value investing looks very different from special situations.

Common Mistakes to Avoid

1. Don't just track winners. The best lessons often come from losses.

2. Don't skip the pre-mortem. Always write down what could go wrong before entering.

3. Don't confuse good outcomes with good process. Sometimes you make money being wrong.

4. Don't wait until the trade is over to log. Write real-time notes.

The Edge Separator

Here's what separates average investors from great ones: the great ones can tell you exactly why they made every trade they've ever made. Not just the price, but the complete thinking process.

When I look at my logs from 2020, I can tell you exactly why I bought a stock when I did. I can show you my work, my thesis, and how it played out. That's not just record-keeping - it's building intellectual property.

Think about it this way: Every trade is tuition in the market. You're paying to learn either way - through commissions, slippage, or losses. The only question is whether you're going to capture that knowledge or let it slip away.

The Real Secret

The secret isn't just in keeping logs - it's in reviewing them regularly and honestly. I spend time revisiting my old trades. That's where the real learning happens.

Schedule weekly reviews of your active positions and monthly reviews of your closed trades. Look for patterns. Be brutally honest about mistakes. This is how you build real edge.

Remember, in investing, your only real competitor is yourself from yesterday. These logs are your path to becoming better than you were.

Stay rational,

Tyler

P.S. A wise investor once told me: "The best investment you can make is in your own learning process." After years in the market, I couldn't agree more.

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