Often overlooked, a trading journal is vital to the long term success of a trader. Having the ability to step back and objectively post review your trades is key to understanding both your strengths and weaknesses.
There are various tools available that allow you to keep track of your trades, some of which we will be reviewing at then end of this article. For a full list, please visit our Trading Journals category.
Taking the time to journal and review your trades can help you develop a strategic and psychological edge, boosting your chances of becoming a successful trader. Developing a winning strategy is key to becoming consistently profitable, however without reviewing your trades, it becomes difficult to fully understand your losses and how to increase your win ratio.
As an example, regularly reviewing your trades may highlight that you often get stopped out just before a reversal occurs. Knowing this information means you can act on it, either by moving your stop and decreasing your position size or by being more patient and finding better entries. Without reviewing your trades, you may not know that timing is the problem at all.
Trading can also trigger a wide range of emotions, especially if you are day trading;
Trading under the influence of these emotions can cause irrational decision making and disrupt trading plans and strategy. Having the ability to review your trades after the event, will expose these weaknesses, allowing you to pinpoint the areas you need to improve upon.
Self-reflection in trading is akin to customer feedback in retail. It’s not always fun and positivity, but it is an essential part of the growth cycle.
A manufacturer won’t be able to improve their products without customer feedback, and you won’t be able to grow as a trader without critiquing the trades and decision you make.
There is no need to manually input all of your trades into your trading journal. Most brokers allow you to export your trades to a CSV file which can then be easily uploaded to one of the trading journals reviewed in this article.
The journaling software will do all of the hard work for you, calculating and displaying the stats you need to form a better picture of your trading journey. Some of the journals will even display your trades visually on a chart so you easily review your entries and exits.
Most modern trading journals allow you to either manually input your trades or upload a CSV from your broker. The software will then work out all of the important stats for you such as winning percentages, which day of the week or hour of the day is most profitable etc..
There are however some additional features which are worth looking out for when choosing a trading journal.
Although trading journals are smart, they wont necessarily know which strategy you were using for a particular trade. It is therefore extremely useful to assign a strategy to each trade so that you can see which are most profitable.
Most journals allow you to not only tag your trades with a strategy, but also tag mistakes that you may have made. By being brutally honest with yourself, you are able to quickly identify areas for improvement.
From personal experience of using a Trading Journal, I discovered that FOMO (fear of missing out) was my biggest offender and I often chased stocks that had already spiked. Having this evidence to hand, I could then work on rectifying this problem. By taking random trades and not reviewing where you are going wrong, will ultimately lead to random results.
Look for a trading journal which allows you to add notes and make sure you regularly review them.
In addition to tagging, note taking will allow you to be much more descriptive. Maybe you were exhausted after a sleepless night or studying for an exam. This may have an impact on your trading psychology so it may be useful to attach a note to your trades to explain the variance in your win rate. It may also be useful to explain a large win or loss in more detail, to help you understand your thought process behind the trade at a later date.
Ensure that your trading journal allows for broker commissions. It may sound like an obvious point to make, but if you don’t account for commissions and fees, your net profit will be skewed and not match back to your actual account balance.
Choosing a journal is down to personal preference, however we have highlighted a few of the most popular below. For a more comprehensive list, please visit our Trading Journals category.
Price: Free trial available. Premium plans start from $29.95 per month. Annual discounts.
Without doubt, TraderSync is one of the most visually appealing trading journals. It is entirely web based so you can access from anywhere, there is even a mobile app. Not only does it look great, it also offers all of the features that you’d expect from a modern journal.
In addition, TraderSync provides advanced features such as Artificial Intelligence (AI) Feedback, advanced performance reporting and the ability to simulate new trading strategies.
Price: Free plan available. Premium plans start from $29.00 per month.
Tradervue continues to be a favorite choice for professional day traders. Although it doesn’t quite have the same level of UI as other journals, Tradervue focuses on functionality and has everything you need to track and review your trades. For those who want that little bit more, advanced reporting and deeper trade analysis is available on Tradervue premium plans.
A free plan is also available for those who don’t require some of the the more advanced features.
A modern, clean UI with some really great features. Trademetria allows you to undertake fundamental research, perform simulations and access rich trade analysis. Trademetria also supports cryptocurrencies, making it useful for those trading some of the more popular coins such as Bitcoin and Ethereum.
Trademetria also allows users to sign up for a free account so you can try out some of the standard features risk-free.
Take some time to play around with several different trading journals until you find the one that best fits your style. Journaling doesn’t have to be all time-consuming and monotonous, you may actually start to enjoy reviewing your trades.
Personally, I enjoy the process and look forward to analyzing and critiquing my trades. It gives me the opportunity to focus my edge and ultimately leads to more profit from the markets.
I hope this information has proven useful in some way. Feel free to check out our full list of trading journals and if there is one you use that we haven’t listed, please let us know in the comments below.