Know what works

Posted on December 13, 2010 by Stock Trade Journal

The ultimate measure of trading success is the bottom line. However, there are other key measurements and statistics in trading that can point to weaknesses in a trading plan.
The key measurements in analyzing a trading strategy or plan are:

  1. Absolute Profit / Loss.
  2. Average Profit / Loss.
  3. Expectancy.
  4. Winner / Loser Ratio.
  5. Time in Winning and Losing Trades.
  6. Average Time in Winning and Losing Trades.
  7. Trading Costs.

It is very important that to keep records of each and every trade and to periodically look at the above measurements. If you are a swing trader, it is advisable to review your trading performance at least once a month.

I have created a free web tool that calculates the above trading statistics from a pre-formated excel templatehere.

The YouTube video below shows you how this free tool works. Please view the video in at least 480 resolution.

About Stock Trade Journal

The information in this blog is not investment advice. Please consult a financial advisor before investing. I have been trading stock since the 1990's and survived the .com crash. I am developing software applications to help me trade better and now I am making them available to help other traders. This blog is also a way to share my experiences and observations in the market.
This entry was posted in General Info, Risk Management, Trade Analysis, Trade Planning, What to Write in a Journal. Bookmark the permalink.

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