Trading Journal : If you find out the performance of a company, you should have to check their financial statement, there you will get all the details about the company , how they are performing, and company record and maintain their each and every data. Similarly Trading Journal is maintaining your trading record.
Trading Journal – Introduction
Similarly to be a good trader you must have write down about your trading, either you are a positional trader or Intraday trader, you must have note down everything related to your trade.
If you are an Intraday trader then you must have write about your trading , this is called trading journal.
To create a trading journal either you can use online tool or you can writer it on your dairy.
In Stock market you will find several trader who trade daily, but you will find very few traders who maintain their trade records, if you want to be a good trader then you should know about your strong point and your weakness, when you maintain and read your daily performance then it helps you to overcome your weakness and improve your trading style.
Trading Journal – What to Track?
Now if you have decided to write your trading journal then the big question is that what you write in your trading journal and what to track.
In your trading journal you should write about your trading, if you are an intraday trader and you put several trade then you should write about your all trade, like why you pick that trade, what is the reason to enter into that trade, what pattern or reason you find to enter into trade, your positon was long or short, how much quantity your have traded, what was your entry price , what was your exit price, how much time you hold your position, how much your made loss or profit the trade etc.
What Do We Track?
The relevant metrics that we like to use for our trading journal are as follow:
- (1) Trade
- (2) Position size used
- (3) Whether we went long or short & why
- (4) Strategy used to execute trade
- (5) Time and date of trade
- (6) Entry Price
- (7) Exit Price
- (8) Final P/L Result
- (8) Screenshots of the trades
- (9) Notes with regards to why we took/disqualified the trades
- (10) Trade Grading
- (11) Note
- (12) Takeaway
- (13) Comment
Trading Journal – How to review and optimize your edge
If you regularly trade with disciplined and consistently update your trading journal, then you should have a nice set of data to review. Here is what to look for in order to optimize your edge and improve your trading results!
- Identify patterns that may be leading to losers and find ways to minimize them.
- Identify patterns that lead to your winners and find ways to maximize your profits.
Trading Journal – Free Tools
Evernote is a good tool to create your trading journal , it provides both the plan, free and paid , in free plant you get maximum 60 mb to use per month, but if your need extra then you can go with their paid plan. However as I have used , it’s a very good tool , to maintain your trading record online , wcich you can easily check from anywhere , either on your mobile or your laptop.
Another free tool that can be accessed with a Gmail email address. This is other great tool which you can use easily to create your trading journal.
Your Own Diary
Excluding these online tool , some of the trade fond up to write in their own diary, that is also a good place to maintain your trading journal, but in diary you can not create your screen shot , how ever you can draw a chart .
Trading Journal – The Full Process
Here I have puted some image screenshot of my trading journal , which I trade in bank nifty , here you will find the process and step by step process how you can write your trading journal.
Trading Journal – Final Thoughts
About trading journal, you can say it a deciding factor between the 5% of traders that are consistently profitable and the 95% that lose money.
If you don’t want to use online tool then Keeping a diary of your trading activity will help you review your results, find out any weaknesses and highlight your strengths. Which will help you optimize your strategy, increase performance and maximize profits!
If you not started to keep your trading journal already, make sure to start keeping a trading journal as soon as possible and see the benefits that it can provide for your trading!
Nirmal is a NISM Certified Derivative Trader & the Founder of InvestandEarn.net (Financial Blog). He entered the world of Equity research to explore his interests in financial markets having 5+ Years of Experience in Share Market Trading & Investing. Nirmal frequently writes about Share Market Trading & Investment and publishes his personal view on the market. Drop him a mail at email@example.com.