With a trading journal, you can also track your progress and see how far you have come since you started trading. This can help to boost your confidence and motivate you to continue improving your performance.
The Advantages and Disadvantages of Trading Journals
While there are many advantages to using a trading journal, there are also a few potential disadvantages to consider.
- Provides a clear structure for organizing trading activity
- Helps to develop a more consistent approach to trading
- Identifies patterns and allows for targeted improvements
- Tracks progress and boosts confidence
- Can be time-consuming to maintain
- May require learning how to use new software or platforms
- May not be suitable for all trading styles or strategies
Overall, the advantages of using a trading journal far outweigh the potential disadvantages, especially for traders who are serious about improving their performance.
What to Include in an Online Trading Journal
When creating an online trading journal, there are a few key pieces of information that you should include:
- The date and time of the trade
- The asset being traded
- The direction of the trade (long or short)
- The entry and exit prices
- The size of the position
- The stop-loss and take-profit levels
- Any notes or comments about the trade
By including this information, you will have a complete record of your trades that you can refer back to and analyze in the future.
The Best Trading Journal Programs, Platforms, and Apps
There are many different trading journal programs, platforms, and apps available, each with their own unique features and benefits. Some of the best options include:
- TradingDiary Pro
Ultimately, the best trading journal is the one that you will actually use and find helpful, so it’s important to try out a few different options to see which one works best for you.
Using a trading journal can help you define clear conditions for entering and exiting trades, leading to a structured plan for profitable online trading. Noticing patterns in your trading activity can reveal profitable and unprofitable trends, such as peak trading times and effective indicators for specific assets.
Trading journals should log all quantitative information relevant to each trade, including setup, trade numbers, and key details of the trade’s conclusion. Qualitative analysis of your feelings and approach can also be included. A good trading journal builds a broad database for analyzing and drawing conclusions about trading performance.
Key inputs for a trading journal include trade date, time frame, setup trigger, specific market, lot size, trade direction, entry and exit prices, stop loss, profit or loss, and amount risked. Organizing this information in a spreadsheet can look like this:
Screenshotting price charts at entry and exit points can also aid in analyzing market patterns. After entering all quantitative details, noting your feelings about the trade can be helpful.
Write down what went well, what maybe didn’t go so well, and how you felt throughout the trade.
Add straightforward descriptions and definitions, for example, “revenge trade”.
This is an opportunity to evaluate the intangible emotional factors that can influence how a trade turns out.
Did you get distracted and miss the ideal point to close a trade?
Or, did you get nervous and exit a position too early?
Perhaps you were rage trading.
These factors are not easily quantifiable, but they are important in understanding your behavioral characteristics while trading – for example, if your risk aversion is missing you opportunities, or, on the other hand, if you’re taking losses from too many risks.
Over time you will produce a detailed database of your trading behaviors, allowing you to develop strategies to increase your profitability or to curb behavior that is costing you money.
How Do I Make A Trading Journal?
Creating a trading journal is easy, and there are plenty of free and easily accessible software programs that you can use to construct a database, or calendar, of your trading history.
All you need is the ability to create tables to input data, to write some text describing your feelings towards a trade, and, if you so desire, the ability to insert any screenshots of market charts you feel will help your analysis.
Paid Trading Journals
One of the most convenient innovations for traders is app software that plugs into your trading platform and automatically creates an interactive trading journal for a reasonable subscription fee.
These tools also offer intuitive charts, feedback and tips to help you improve.
The top trading journals and notebooks with charts include:
- Edgewonk – noteworthy for its “gamification” feature, which sets challenges for traders based on their performance, creating an enjoyable way of putting into practice the lessons learned by analyzing their trading journal.The software also integrates with established platforms like MT4, MT5 and cTrader.Additionally, Edgewonk offers user-friendly dashboards with intuitive layouts.The software breaks down your trading characteristics and shares ideas to improve your technical trading, for example.
- TraderSync – popular among traders for features including AI feedback and automatic profit/loss calculations.The program also automatically syncs with supported brokers so you don’t need to manually input trade information.Tradersync is ultimately one of the best quantitative trading journals you can buy online.With multiple uses, the software comes with sample trade setups, notions about how emotions affect trading, market research, and more.
Free Trading Journals
Traders can also make use of the following well-known programs, some of which are available as free downloads:
- Microsoft Excel
- Google Docs
- Google Sheets
- Apple Numbers
Some of these examples are also available in app form, making them easy to access when trading on the go.
Final Word On Trading Journals
Trading journals provide you with a legal, structured way to record your investing activity, allowing you to look back and analyze what worked and what didn’t, and improve your trading performance going forward.
As such, traders from all countries, be it the UK or the US, India or the Philippines, should consider keeping a journal or diary to improve their trading skills.
New apps such as Edgewonk and TraderSync make keeping a trading journal straightforward since they will automatically record all of the relevant quantitative information as you trade. They also bring technological innovations that help you analyze the recorded data and execute new trades. As a result, they top our ranking of the best online trading journals in 2023.
However, if you prefer to keep a journal of your own without paying for new software, you can use Excel, Google Sheets, or many other common applications.
What Do I Need To Put In A Trading Journal?
At the bare minimum, a trading journal should include the profit and loss made on each trade, along with the date and time the trade was made. However, the more you put into a trading journal, the more you will get out of it, so it is best to include as detailed an account of your trades as possible.
Logging emotional factors, such as what motivated you to trade can also prove useful.
Do I Have To Use A Trading Journal?
No – you don’t have to use a trading journal. However, if you are serious about making money through trading online then it is a no-brainer. The advantages are numerous, and the only real drawback is the time you will need to spend organizing your journal.
But importantly, this will be time well-spent and should have a positive impact on your trading efficiency and effectiveness. And, if you prefer not to spend time taking notes, you can find interactive brokers with automated journaling or pay for apps and websites that provides this service.
What Is The Best Platform For Making A Trading Journal?
Many programs can be used to create a trading journal, from classic spreadsheet software like Excel and Word to sophisticated paid applications.
Some brokers offer an inbuilt journal template, and this will save you time by automatically recording the data needed.
Apps like Edgewonk and TraderSync also automatically record your trading data, as well as offering useful analysis and training features.
Will A Trading Journal Make Me More Money?
While a trading journal is a good way to make your investing activity more organized and efficient, there is no guarantee that it will make your trading more profitable.There is always a risk with trading that you may lose money, so a good strategy is required if you hope to make a profit consistently.
The best way to develop a good strategy is to use a trading journal to notice patterns in your trading, allowing you to make refinements and improvements.
Do I Need A Trading Journal For Very Short-Term Trades?
A trading journal is useful to any trader, no matter what timeframe they are trading in, be it day trading or swing trading.