(Total profit and loss) allows you to understand your overall trading performance, and recording data will help you discover which parts of your trading system, plan and process allow you to move forward like a well-tuned racing car rather than a worn-out classic car .

Your performance will help you determine what is feasible, what is not, and what needs to be improved. Here is the minimum data to record to track your system’s lifeblood:

Net profit: This is your total income minus total losses and expenses. Expenses include equipment costs, commissions and other costs.

Profit ratio: the total profit divided by the total number of transactions. What is your profit ratio?

Loss ratio: the total loss divided by the total number of transactions. What is your loss ratio?

Maximum profit trade: will be removed from your “average profit” calculation. It is not necessary to do this, but if you have abnormally large profits relative to other profit conditions, remove them, which will make your trading conditions and expectations more accurate.

Maximum loss trade: The price is deducted from your “average loss” calculation. It is not necessary to do this, but if you have abnormally large losses relative to other damaged conditions, remove them, which will make your trading conditions and expectations more accurate.

Average transaction revenue: The computer handles the total profit divided by the number of profitable transactions.

Average transaction loss: The computer handles it by itself, and the total loss is divided by the number of damaged transactions.

Return per transaction: average profit minus average loss

Average holding time: Total holding events divided by the number of transactions.

Long/short trading profit and loss: This data helps determine which type of trading or trading environment you perform better.

Maximum#Consecutive loss: This data helps you determine your biggest loss, which can also be said to be the worst situation you have experienced.

Average#Consecutive loss: This data helps you determine your average loss size and helps you control the maximum loss risk that may occur.

Maximum shrinkage of trading account: After a series of impaired transactions, the maximum amount your account loses.

Record your feelings and mistakes: how well you perform a transaction can be measured, and so can your mental state during the transaction. Recording your feelings can help you avoid trading in a state of frustration-for example, when you wake up, there is a news event (you forgot), it drives the market to change rapidly, and you are eager to catch up. But your computer crashed, you lost your strength, and your dog happened to ran into the oncoming traffic and killed it. When you go online again, you find that the market has moved 100 points in the direction you want to buy. Don’t you get angry when this sort of thing happens? That is your mood must be bad, so it is a bad idea to continue trading for the rest of the day.

Expectation: Simply put, expectation is the profit (loss incurred) you want to make in each transaction. This value can be obtained by multiplying the profit ratio by the average profit minus the loss ratio and multiplying the average loss. This data helps you determine the correct position size and the profitability of your trading method.

Ideally, you should write down all these data so that you can compare and analyze your trading performance over a period of time.

For example, at the end of the year, Zhang San checked his year-end transaction review. After reviewing all the transactions, he discovered that he had made transactions that deviated from the trend without knowing it. Knowing this, he can adjust his trading, avoid deviating from trend trading, and obtain better trading performance.

The purpose of collecting and recording these data is to find ways to expand your expectations (profits per transaction), to help you determine the correct position size and the most suitable trading environment for you.

Transaction record review

After a series of transactions, you have collected some gorgeous data, market and self-observation records… how do you analyze it?

It’s simple:

  1. Find what is feasible and keep it up
  2. Find the infeasible, and quickly abolish it

To find out what is feasible and unfeasible is to observe carefully and ask the right questions. Divide your trading results into several sub-categories for analysis, such as the day of the week or a specific currency pair.

Below are examples of questions you can ask yourself when reviewing your logs:

Which model or tool is best for you? Which is not suitable?

How do you adjust the indicator to enter the trade as soon as possible, or to help you avoid double losses and false moves?

Did you end the profitable trade too early? Is it because you need to adjust the profit target, or are you worried that the target is unrealistic?

Are you staying on impaired transactions for too long? How can you improve your stop loss process?

How often do you follow the trading plan? Are all the transactions you follow the plan profitable?

What are the transaction settings you missed or not used, and why? Is there a legal signal, or do you follow your own method and system?

What are the different ways you can take your losses or expand your gains?

Do you make more profits when you trade in multiple groups, or do you make more profits when you trade in a single group?

In what kind of market environment do you perform well? Trend or magnitude?

Do your profits and losses occur only in certain currency transactions?

Which news event brought ideas that made you want to trade or avoid trading?

Which trading session is best for your trading style?

Are your damaged transactions concentrated on certain days of the week, such as Monday or Friday?

This type of problem can help you quickly find ways to prevent you from making money.

In the beginning, the idea is to make you clearly understand which practices you are suitable for, so that you can only do the right things.

Once you understand the right thing, the next step is to keep practicing these practices until they become a habit.

In the end, keeping a journal will allow you to achieve your best performance and help you identify when the market changes-indeed, the market is always changing.
Keeping a record of transactions is difficult, but useful

It is very difficult to keep a transaction log.

But in this way you will lose your trading capital, become a failed foreign exchange trader, give up and never conduct foreign exchange transactions. Then I began to think back to the simple and happy days when the super boy performed.

Which way do you choose?

Recording the transaction in the log forces you to view your transactions in black and white instead of relying on your memory. For most people, memory is stretched.

More importantly, the log allows traders to take a step back and view a set of transactions they have made, not just a single random transaction.

This sounds like a lot of things to do, doesn’t it?

It’s true, but doesn’t everything have to be achieved through moderate effort? ! ?

Keeping a journal is like an exercise done by an athlete.

It is rare that a professional telemobilizer spends less time training than he participates in a competition.

Michael Jordan’s personal fitness coach Tim said:

“Michael scored 40 or 50 points the night before, and the next morning, he will immediately go into training. He does not want to take a day off. His perseverance is incredible, but his willingness lies in his doing well every day. Physical preparation. He famously said,’I train hard because it makes the game easy.'”

John Wooden, the 10-time American college basketball league champion, is known as a great man in basketball. He has to conduct rigorous 2 hours of training 5 days a week to prepare for the 40-minute basketball game.

Do you know how long it is? For a 40-minute game, 10 hours (600 minutes) of training are required.
Not only that! He not only emphasized rigorous training, but also recorded the status of training. Coach Wooden will review his diary when problems that he is difficult to solve appear on the team he coaches.

For example, if the team he coaches has poor shooting, he will study past training logs to see how to improve his shooting percentage. Even in an era without computers or iPads, Coach Wooden understood the importance of strict logging.

Although the act of keeping a diary is not that difficult, it does require time and energy. It is definitely a time-consuming process.