Trading Psychology, the Trading Journal and Overtrading

Trading psychology is usually taught as motivation. This course teaches it as evidence. Decades of research on decisions under risk explain why traders cut winners early, hold losers too long, size up after a lucky week and trade to win back a bad morning. Knowing the research does not make you immune, but it lets you build routines that catch the mistake before it costs money.

Why do traders hold losing trades too long?

Because a realized loss hurts more than an open one, and selling makes it real. Researchers call it the disposition effect and have found it in millions of brokerage accounts. The course shows you how to measure it in your own record and the rules that counter it.

How do you stop revenge trading?

Not with willpower. With rules written in advance that end the session after a set loss or a set number of losing trades, and a routine that makes you step away. The course has you design these rules and test them on your simulated trading.

What makes a trading journal useful?

A trading journal is the only honest witness to your trading. Memory keeps the winners and edits the losers; a written record keeps both. Traders who review a journal every week learn which setups pay, which mistakes repeat and which days they should not trade at all.

Consistency and tags. A journal that records the same fields for every trade, and tags each by setup and by mistake, can answer questions: which setup earns the most after costs, how much revenge trades cost, whether Friday afternoons are worth trading. The course builds that journal with you.

What causes overtrading?

Overtrading means taking more trades than your edge supports. Each extra trade pays the spread and commission, and the extra trades are usually the worst ones: taken out of boredom, after a loss, or because a market moved without you. Studies of brokerage accounts have long found that the most active traders earn the least. This course measures the habit in your own record and builds the limits that contain it.

Mostly the same forces that drive gambling: variable rewards, the wish to win back a loss, and the discomfort of doing nothing. Screens that are always on and commission-free platforms make it worse. The course has you tag the trades driven by each cause and calculate their cost.

Who is this course for?

Every trader on the trader path, and experienced traders whose results depend on their mood. No programming is needed.

What you will be able to do

• Describe the main biases in trading decisions and the research behind each.
• Identify your own patterns of tilt, revenge trading and overtrading from your record.
• Design a pre-trade and post-trade routine that interrupts the costly ones.
• Recognize the signs that trading has become a gambling problem, and what to do about it.
• Record each trade with its plan, execution, costs, outcome and state of mind.
• Measure trade frequency, cost drag and results by setup, time of day and state of mind in your record.

Syllabus, module by module

1. Decisions under risk

   Prospect theory, loss aversion and the disposition effect: why traders sell winners and hold losers.

2. Overconfidence

   The illusion of control, the hot hand and what a winning streak does to position size.

3. Why a journal

   Memory, hindsight and the selective recall of winners; what a written record fixes.

4. What overtrading is

   Trading more than your edge supports, and the research on how trade frequency relates to returns.

What every course contains

Every paid course comes with the first seven and the certificate, whichever level it sits at. The proctored exam and the credential come when the course is taken as part of a Certificate, Diploma or Fellowship. Everything is self-paced: the material is yours to study in any order, at any hour, for the whole of the license.

1. Workbooks. Written to train the thinking patterns and the important concepts of the course, with worked problems and the reasoning behind each answer, so that you learn to think the way the subject is thought.
2. Audio edition. Focused, well-presented recordings with explainers and examples of the material, made to be interesting, relevant and entertaining, so that the general subject can be learned away from the desk.
3. Notes. Pre-produced notes with every fact the course relies on, written out in full, so that nothing has to be transcribed from the films or the audio.
4. Cheat sheet. One sheet with every important learning concept of the course on it, to keep beside you during the work and to revise from before the exam.
5. Named sources. Every fact in the notes names its source, the paper, the book or the dataset, for anyone who wants to dig in further.
6. Explainer films. Focused films, in the style of the sample films on the catalog page, that walk through the most difficult concepts of the course with visual explanations of a high standard.
7. Transcript. A full transcript of every film and every audio recording, searchable and quotable.
8. Proctored exam. Taken as part of a Certificate, Diploma or Fellowship, the course ends in a proctored multiple-choice questionnaire, with a pass mark of 60% and three retakes included. A course taken on its own is assessed by its coursework and has no exam.
9. Verifiable certificate. A certificate of completion that a third party can verify: an employer sends the code on it to the credentials office and receives written confirmation of the course, the date and the result.
10. Credential of the program. The Certificate, Diploma or Fellowship of the program, track or path the course belongs to, awarded when every course in it is passed. Which one depends on the program you choose.

How the certificate is earned

Weekly reflection exercises and two graded problem sets: a bias audit of thirty of your simulated trades, and a written personal routine with the evidence for each step. On a pass you receive the Course certificate in Trading Psychology, the Trading Journal and Overtrading, issued by the Institute with a verification code. A course taken as part of a Certificate, Diploma or Fellowship ends in a proctored online exam with a pass mark of 60%. The fee includes three retakes; each attempt after that carries a reduced proctored exam fee. A course taken on its own is assessed by its coursework and has no exam. Read how certification works.