Trading Journal Example – How To Make One (Including Spreadsheet)

Last Updated on November 17, 2021 by Oddmund Groette

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, and how often you should look at your trading journal. We also provide a spreadsheet as an example to get you started.

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. If you take trading seriously, you’ll find this as an invaluable tool later on:

Why trading journals are useful

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
  • Get trading ideas

The last point is often overlooked. A trading journal is a great tool to get inspiration and new trading ideas.

How to create a trading journal

Creating a trading journal is simple. You need to tailor it 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.

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.

When to keep records in trading journal

At the end of the trading day, you would want to write down all your trades in your journal. It might not be the fanciest job in the world, but our best advice is to put 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.

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.

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.

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 the best for you.

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 spreadsheet

We have made a simple sheet for your convenience to download:

Summary about trading journals

After reading this article, we hope you understand the benefits of having a trading journal, and how you can make one yourself. When you start trading you should make sure you have one as soon as possible. You’ll soon discover what you are doing correctly or where you go wrong!

 

Disclaimer: We are not financial advisors. Please do your own due diligence and investment research or consult a financial professional. All articles are our opinions – they are not suggestions to buy or sell any securities.