A trading journal is a written record of every trade you take: what you traded, why, how much, where you got in and out, and what you were thinking and feeling. It can be a notebook, a spreadsheet or a notes app. The format matters far less than the habit of filling it in every time, including the trades you would rather forget.
Almost every experienced trader keeps one, for a simple reason: memory is a poor judge of performance. People remember their big wins and their painful losses, and forget the dozens of ordinary trades in between that decide the real result. A journal replaces impressions with numbers.
What a journal tells you that nothing else can
- Whether your method makes money: your actual win rate, average win, average loss and expectancy, after costs. See the risk-reward guide for how these fit together.
- Which setups work for you. Many traders find that one or two types of trade make all the money and the rest lose it slowly.
- When you trade badly. After a loss, late in the day, on expiry day, on Mondays, when tired or distracted. Patterns like these are invisible without a record.
- Whether you follow your own rules. If your plan says risk 1% and the journal shows 3% on some days, you know what to fix.
What to record for every trade
Keep it short enough that you actually do it. A simple template:
| Field | Example |
|---|---|
| Date and time in / out | 2026-11-10, 09:42 / 13:15 |
| Instrument | NIFTY 25,000 put, weekly expiry |
| Direction and size | Bought 1 lot |
| Setup (why) | Failed breakout above the morning high, NIFTY back below VWAP |
| Entry, stop, target | ₹110, ₹80, ₹170 (risk-reward 1:2) |
| Exit and reason | ₹95, time stop at 13:15, no follow-through |
| Result after costs | Loss, in rupees and as % of capital |
| Market conditions | Trend, breadth, India VIX, any event that day |
| Followed the plan? | Yes / No, and what was different |
| Feeling before and after | Impatient after missing the open; relieved to exit |
A screenshot of the chart at entry and exit is very useful when you review, because it shows what you could see at the time, not what you know now.
Record the market, not just the trade
The same setup can work well in a trending, confident market and fail in a nervous, choppy one. Noting the conditions on each day lets you later sort your results by them. Two quick readings that take seconds: how many stocks are rising against falling (market breadth), and the overall mood score. Here are both as of now:
Breadth shows whether a move is broad (most stocks joining in) or narrow (a few large stocks pulling the index). A day with far more declines than advances is a different market from one where most stocks are up, even if NIFTY closes at the same level.
The mood score combines several measures into one number from fear to greed. Write down the reading on the days you trade. After a few months you may find, for example, that your breakout trades do well in greed and badly in fear, which is worth knowing. The market mood guide explains how the score is built.
How to review your journal
A journal you never read is just a diary. Set fixed times:
- Daily (5 minutes). Fill in any missing fields while the day is fresh. Mark each trade "followed plan" or "did not".
- Weekly (20 minutes). Look at the screenshots of the best and worst trades. Was the loss a good trade that did not work, or a bad trade? Those are very different problems.
- Monthly (an hour). Work out the numbers below and compare them with last month.
The monthly numbers:
- Number of trades, win rate, average win, average loss.
- Expectancy per trade after costs.
- Largest single loss as a % of capital, and the largest run of losses in a row.
- The same figures split by setup, by instrument and by time of day.
- Total costs paid (brokerage, taxes and charges), which many traders are surprised by. See trading costs.
A worked example of a monthly review
Say your journal for one month shows 40 trades on NIFTY options. Overall you are down ₹6,000 after costs. Splitting by setup:
| Setup | Trades | Win rate | Net result |
|---|---|---|---|
| Breakout after 10:00 | 14 | 50% | +₹9,500 |
| Reversal at support | 10 | 40% | +₹1,500 |
| First 15 minutes after open | 11 | 27% | −₹12,000 |
| "Revenge" trades after a loss | 5 | 20% | −₹5,000 |
These are made-up numbers, but the pattern is common. The method is not broken; two kinds of trade are. A sensible change is to stop trading the first 15 minutes for a month and add a rule that ends the day after two losses, then check whether the numbers improve. Change one thing at a time, otherwise you cannot tell what helped.
Be careful with small samples. Ten trades can look good or bad by luck. Draw firm conclusions only from dozens of trades of the same kind.
Two more figures are worth tracking from month to month. The first is the largest drawdown: the biggest fall in your account from a high point to a later low. It tells you how bad a rough patch has actually been, which is useful when deciding whether your position size is comfortable. The second is the share of trades where you followed your plan. If that share rises while the results improve, the progress is real and repeatable; if results improve while discipline falls, luck may be doing the work.
The emotional side of journaling
Writing down how you felt sounds soft, but it is often the most useful column. Fear, impatience, boredom and the urge to "win it back" cause many of the worst trades, and the journal shows when they appear. The trading psychology guide covers the common ones. Be honest; nobody else needs to read it.
Practise the habit before you need it
The best time to start a journal is while paper trading, when nothing is at stake. On the paper trading page you can place practice trades at live prices and journal each one exactly as you would a real trade. Paper results do not include charges, so add an estimate of costs in your journal to keep the numbers honest. For setups you want to check over many past days at once, the backtester gives a long record quickly, which your live journal can then confirm or contradict.
Common mistakes
- Only recording wins, or skipping the embarrassing trades. The skipped trades are usually the lesson.
- Recording results but not reasons. Without the "why", you cannot tell skill from luck.
- Changing everything after one bad week. Give a method enough trades to judge it.
- Making it too complicated. A journal with thirty columns is abandoned in a fortnight. Start with the template above.