Trading Journal Example (Free)- How To Make One (Including Spreadsheet)
Last Updated on April 18, 2023
This article provides you with a free downloadable trading journal example. A trading journal (or trading log) is a great tool for any aspiring trader. We recommend writing down all your trades in a database after each trading day.
This article describes what a trading journal is, why they are useful, how you create one, what to record in the journal, how often you should look at your trading journal, and finally, we provide a trading journal example for free.
Invest in preparedness, not in prediction.
Being prepared is one of the most important factors in succeeding whether you are an investor or a trader. Having a trading journal is an absolute must, but we are pretty confident in saying very few traders keep one. Thus, to succeed in short-term trading, which very much is a zero-sum game, you gain an advantage over your competitors just by having a trading journal!
First, let’s define what a trading journal is:
What is a trading journal?
A trading journal is a log (normally a spreadsheet) that you use to record your trades. Let’s call it a database of all your trades. You can later reflect upon earlier trades and thus evaluate yourself. It’s a fantastic tool to create a good feedback loop – a prerequisite for successful trading. Feedback is the most important thing in improvement!
We regard a trading journal as one of the most important factors for becoming a successful trader. If you take trading seriously, you’ll find this an invaluable tool later on:
Why trading journals are useful – why use it
We have emphasized many times the importance of a trading journal, and we can assure you will find it handy and useful at a later time.
Perhaps the main reason why a trading log is useful is that it forces you to have a trading plan. It might force you to backtest what you are actually trading! Additionally, you need to share some thoughts on risk management, drawdowns, and trading psychology.
Other things that are useful with a trading journal:
- You get statistics of your win ratio and consistency
- You can compare backtests to live trading (to find out slippage)
- It keeps you accountable
- You can find patterns in your habits you were unaware of
- You can find which strategies you perform the best at
- You create a feedback loop
- Get ideas for trading edges (what is a trading edge?)
The last point is often overlooked. A trading journal is a great tool to get inspiration and new trading ideas, and having a trading journal is one of our main trading lessons.
Trading plan
A trading plan is not the same as a trading journal. While a journal records all your trades in a log, a trading plan is the work you put in before you do the log. The plan is how and why you trade. You need to be systematic to have a trading plan. It involves having clear trading rules and settings for each strategy or asset you are trading. Mind you, we recommend having many trading strategies that have an internal low or negative correlation. Preferably, the strategies should complement each other.
Trading plan and mechanical trading
The more you quantify, the more you can automate. Automation is power! If you are able to automate your strategies it means more strategies to trade. There are practically no limits to how many strategies you can trade – except your imagination to backtest and find new trading strategies.
If you are new to mechanical trading we recommend the following two articles:
- Mechanical Trading Strategies – Advantages with Mechanical Rules and Edges
- Mechanical Trading Strategies Vs. Discretionary Trading Strategies
Do professional traders use a trading plan?
They do. Jim Simons, the man behind the Medallion Fund, is a perfect example of how far you can get with a backtested trading plan. It’s probably the most successful hedge fund on this planet.
To be perfectly honest, there is just one thing that prohibits you from having a trading plan and journal: laziness.
How to create and write a trading journal
Creating a trading journal is simple. You need a spreadsheet and you need to tailor the spreadsheet to your own needs, but this is done by trial and error. There are no hard rules for what you need to record, but we provide you with an example further down in the article.
The best strategies can be found in our….
Strategy Shop
Backtested trading strategies
You can create a journal in 1-2 hours. The best advice is simply to start. As you go along you might find other variables you want to record. The longer you keep trading, the more you’d want to put into your trading log.
When to keep records in a trading journal spreadsheet
At the end of the trading day, you would want to write down manually all your trades in your trading spreadsheet. It might not be the fanciest job in the world, but our best advice is to put it in the records while it’s still fresh in your memory, even though it might be more tempting to order champagne and escorts after a great trading day.
We stress the importance of keeping a manual log. We are sure it’s tempting to copy and paste, but you’ll miss details if you don’t do it manually. We have always done our trading log manually. At the height of our day trading back in 2008, we made hundreds of trades per day, yet we still entered the trades manually. By doing it manually, we managed to tweak our strategies all the time. The devil is in the details!
If you keep records for a long time, it gets more and more interesting the more data you have. You can look back on past performance and find out where you went wrong or what you can do to improve performance. The devil is often in the details. If you have a long trading journal, you have a great tool to create a feedback loop.
What should be in a trading journal?
Certain items should be a bare minimum to keep in your trading journal. An example of what you could have in your trading journal is the following:
- Name of strategy
- Long or short direction
- Date of opened position
- Date closed position
- Entry price (commission)
- Exit price (commission)
- Position size
- Max drawdown
- Risk/reward
- Profit/loss
As you can see, this is no rocket science – it’s more about discipline and taking the time and effort to do this exercise consistently.
You can also have a section in the journal where you jot down your emotions.
As you go along you’ll most likely expand on the variables in the journal and log. You need to find out by trial and error what works best for you. As mentioned above, the best way to do trial and error is to do it manually.
When to scrutinize and reflect upon the trading journal
A trading journal is a tool that you should at least look at monthly, but it depends on your amount of trades, of course. The more data you have in your database, the better the tool!
Download our trading journal example spreadsheet
We have made a simple trading journal example (spreadsheet) for your convenience to download:
- Trading journal example for OpenOffice
- Trading journal example for Excel
Below is a screenshot of a simple trading journal:
List of trading strategies
We have written over 800 articles on this blog since we started in 2012. Many articles contain specific trading rules that can be backtested for profitability and performance metrics.
The trading rules are compiled into a package where you can purchase all of them (recommended) or just a few of your choice. We have hundreds of trading ideas in the compilation.
The strategies are taken from our list of profitable trading systems. The strategies are an excellent resource to help you get some trading ideas.
The strategies also come with logic in plain English (plain English is for Python traders).
For a list of the strategies we have made please click on the green banner:
These strategies must not be misunderstood for the premium strategies that we charge a fee for:
Summary of trading journals
This article provides you with a free trading journal example (spreadsheet). The benefits are more apparent the longer you trade and the more experience you get. Make sure you have a trading journal!
When you start trading you should make sure you have a trading journal as soon as possible. You’ll soon discover what you are doing correctly or where you go wrong! And if you also update your journal manually, you’ll see details you otherwise wouldn’t if you cut and paste.
Hi Oddmund, as usual your articles are very useful. I disagree on one point only: recording trades every day in the trade log. I used to do this long ago, but this made me more inclined to make discretionary trades trying to correct the equity line when I didn’t like it. And avoiding discretionary trading is the big hurdle to overcome.
Hi Luca,
Thanks for commenting. Most actions we take have side effects. Yours I have never thought about.
We got to stick to what works for oneself. A trading log works very well for me and makes me NOT make discretionary trades. I guess we a re all different 🙂