If you want to improve your trading in an easy, fast and most importantly, in a proven way, you have come to the right place! If you are willing to put in a few minutes per trade, I will present you a way to take your trading to the next level.
The simple solution to improving your trading profitability is tracking your performance! Tracking trades is an essential part of becoming a successful trader.
To prove this point, I want you to watch a short video. It contains parts of two interviews with Tim Grittani and Michael Goode. Both of these traders have insane track records. Just take a look at the following profit chart of Tim Grittani:
As you can see, Tim Grittani is a massively successful trader. In the following interview snippets, he and Michael Goode (another multi-millionaire trader) reveal what it takes to make it as a trader!
These two traders are just two examples of very successful traders that put a lot of emphasis on the importance of tracking trades. No matter what you are trading and what your trading style is, you have to track your trades! It doesn’t matter if you are an options trader, futures trader, stock trader, Forex trader, day trader, swing trader or any other type of trader.
So now you know the significance of tracking trades to improve your trading performance. Therefore, let us move on to different methods of tracking trades now.
Tim Grittani: “Turn the losses into a positive learning experience by tracking trades.”
Need an Excel Trading Journal Template? Go Here!
How to track your trades?
There are three main methods to track trades. These main ways to track your trades are:
- Using pen and paper
- Using dedicated trading journal software
- Using a general-purpose program to track trades (e.g. Excel or other Spreadsheet software)
But which of these methods is best for tracking trades?
In my opinion, general-purpose programs such as Excel is the best solution. Let me tell you why next.
First of all, pen and paper definitely is an option. However, this will take the longest time because you would have to write down and calculate everything manually. Furthermore, you can’t really analyze your performance unless you spend hours upon hours calculating and preparing different stats and aspects of your trading. Therefore, I would consider tracking trades with pen and paper a waste of time!
What about trading journal software?
This is definitely a better solution than pen and paper. The main problems that I have with these programs are that they are quite expensive, they have limited features/customizability and frankly, I don’t think they are very necessary.
One of the best trading journal software that I know is Edgework. It costs $169. But I don’t think it allows you to track options trades and it has other limitations as well.
Another dedicated trading journal software (that allows options trading) is called Trading Diary Pro. It costs $149. But even at that price, you won’t get access to everything/all future updates.
Besides these two programs, there are different trading journal programs as well. Most of them are in a similar price range. Some are even paid on a monthly basis (e.g. $30/month). So as you can see, these programs aren’t cheap and may have some limitations.
The Best Alternative to Trading Journal Software: Excel
Instead of spending a lot of money on such software, I just recommend using Excel, Google Spreadsheets or a similar program. Doing this won’t only save you money. But it will also allow you to track whatever you want to track and how you want to track it.
With that being said, if you decide to use Excel or a similar program to track your trades, it is important to create a good spreadsheet. Otherwise, there is no point in even tracking your trades. Let me give you an example of what not to do:
A lot of people that use Excel as a trading journal simply create a table with entry price, exit price, position size, ticker symbol (and potentially one or two other similar metrics). Only doing this is POINTLESS! Your trading won’t change at all if you track your trades like this.
By doing this, you simply see your profitability… This can be seen in every broker platform as well. So it is not more than a waste of time!
So what should you do instead?
First off, the more metrics you track, the better. If you track more things, you will be able to improve your trading from multiple different angles.
More Data = Better Insight = More Potential For Improvements
Furthermore, you should NEVER only track the numbers and other concrete stats. You should ALWAYS add notes to trades in your trading journal.
Always answer the following questions:
- What was your plan?
- Did you stick to your plan?
- How did the trade go?
- What did you learn?
- What could you do better next time?
If you skip this part, you won’t learn from your trades. It is extremely important to reflect on your trade, your plan, and its execution. Otherwise, you won’t be able to avoid the mistakes that you made on your next trade.
In addition to notes, you should also add different graphs to visually analyze your performance. There is nothing worse than having a huge spreadsheet filled with different numbers and notes. You can’t really do a whole lot with this. That’s why you need summaries and visual representations of different aspects of your performance.
Here is a list of a few things that every trading journal spreadsheet needs:
- Total P&L
- P&L Graph
- Win Percentage
- Average Percentage Gain/Loss
- Average Dollar Gain/Loss
- Daily/Weekly/Monthly/Yearly P&L
- P&L Distribution Chart
- And More
Besides this, you should ideally be tracking even more stats. But another important thing that every trading journal has to do is track trades/setups separately. You might remember from the video that I showed you earlier that Tim Grittani and Michael Goode constantly emphasized the significance of tracking different setups differently.
Michael Goode: “Track your trades separately by strategy. For instance, track dip buys separately from breakout buys, from shorts of overextended stocks...”
Different things are different. So it’s a huge mistake to track all your trades together. This will just make the results useless. Let’s say you have three different strategies that you use very regularly. If you would track all of them together, you couldn’t analyze which strategies are working and which aren’t. Furthermore, you couldn’t learn from your mistakes because a mistake on one of the strategies isn’t necessarily a mistake on a different strategy.
But if you would track all three strategies separately, you might find out that the majority of your losses come from one of the strategies and you, therefore, you should rather focus on the other two profitable strategies. Additionally, you could find aspects that you could improve for each strategy.
Hopefully, this example shows the importance of tracking different setups separately. Tracking different strategies separately also means that you should track all of the above-mentioned metrics for EACH strategy separately. So you should track the P&L, Win Percentage, Average Gain/Loss, Graphs and the other metrics separately for different strategies.
Don’t want to create your own Excel Spreadsheet?
As you can see, creating a useful Excel spreadsheet that actually can improve your trading performance isn’t easy. Creating a really good Excel trading journal takes a lot of time. From personal experience, I know that this can be a very overwhelming thing. That’s why I want to make you an offer.
Recently, I sat down and fully focused on creating the best possible Excel trading journal for an entire week. It was a very tedious process. However, I am very satisfied with the end result and I am definitely planning on using this Excel trading journal template to track ALL my future trades.
So if you want to save yourself the time and hassle of creating such an Excel trading journal template, you can use mine.
To learn more and to gain access to my Excel trading journal template, go HERE.
Hopefully, this article made the importance of tracking trades clear. Tim Grittani and Michael Goode are just two of many successful traders that revealed how essential tracking trades was to their success. So if you take one thing away from this article, it should be:
TRACK YOUR TRADES AND LET YOUR RESULTS GUIDE YOU!!!
There are multiple ways to track your trades. But the most useful, cheapest, most convenient and generally, the, in my opinion, best trading journal software is a spreadsheet program like Excel. However, even though tracking trades in Excel is great, it can be quite hard and definitely time-consuming to create a good and actually useful Excel trading journal template.
But luckily, you don’t have to create your own, if you don’t want to! You can use my Excel trading journal template that allows you to analyze a multitude of different dimensions of your trading performance.
29 Replies to “Best Trading Journal Software – The Truth Revealed”
This is pretty smart, excel is a great tool not just for trading , I remember that when I was getting coached online for natural bodybuilding they did use an excel spreadsheet to track my macros, my weight, and based on that the decision will come and see it as a linear progress over time you know what will eventually work or not.
Tracking things to find out what works and what doesn’t applies to almost anything. Trading and bodybuilding are just two examples of this. This scientific method is one of the only proven ways to progress.
Interesting this is something that I was always afraid to get into because I have never been familiar with trading stocks; thanks to your article I am going to give it a try. Starting small of course and see where it goes. Tracking can be very useful in more ways than one I am sure; but when working with trading it is so valuable to know what your doing or your going to lose the money you have invested quickly.
Thanks for all the tips I am going to take this and see how or if I can get things to work for me.
I am happy to hear that I inspired you to try out trading. However, it is very important that you start out as tiny as possible. You should definitely not risk anything that you aren’t willing to lose. Furthermore, I recommend educating yourself before risking any real money. The stock market is a tough game, therefore, it is very important to be fully prepared before going in with real money.
Another tip for a beginner would be to be patient. Becoming a successful trader takes time and dedication. So don’t expect too much too quickly.
I didn’t even think of using excel for trading but I guess I don’t really know how to work with excel hence why it didn’t come to mind. Paying for these trading softwares seems to expensive but I do see the benefit in doing it. I only have a couple of bitcoins which is just sitting there and hopefully going up again soon. But if I ever look back into trading forex I will definitely have a journal. Thanks for some great info
You’re very welcome Hendrik. Many people avoid using Excel because they think they don’t know how to use it and it seems conplicated. But honestly, it really isn’t that hard to use. It is totally possible to learn all the basic functions within very few hours, especially nowadays where we have access to so much free information through the internet.
Hi Louis. I’ll be the first to admit that I’m very new to trading. I’ve tried to find out some information on it by searching the net. Unfortunately most blogs bombard you with all sorts of banners and popups and other advertising methods. In the end it is hard to concentrate on the actual information I came for. I’m not against this sort of obvious revenue raising for their sites, it’s just the sheer volume that disturbs me. Your site was much easier to navigate and I actually learned something from it. However, I would like further information. You have my email address, could you please send me further information that is written in a “Trading for Dummies” style of language. Thanks Jim
Thank you for your comment Jim. I completely agree that many other (‘free’) trading websites are filled with ads and similar annoying things. Furthermore, the information found on these websites often is of poor quality.
As for further information in a simple format, I would like to direct you to my free options trading foundation masterclass. In it, I go over all the basics and fundamentals of becoming a successful trader. So make sure to check out the Free Trading Foundation Masterclass.
Tracking metrics and information is good for anything you want to improve upon in life. Using excel is an excellent suggestion if you know the correct metrics to track. You have put together an excellent post about tracking trading metrics to improve your chances of success. Thank you for the information and suggestion.
Have a great day.
I am very glad to see that you liked my article.
I think anytime you’re trying to make money, it’s good to track it! I love, love that you have a simple way of tracking though – through Excel or Google Docs. Thank you for not sending me off to some fancy expensive software. Simple is almost always better.
I haven’t gotten into trading yet, but I would love to learn. Do you think your tracking template will be good for a newbie like me? Or is it better if I start smaller at first? And if so, do you have any suggestions of where I should start?
First of all, thank you for your comment Christina. I completely agree with you that it is good to track almost anything. Tracking things simply is a scientific approach to finding what works and what doesn’t. This applied to almost any area in life.
I do think that my Excel trading template is for anybody, even for beginners like you. New traders that have no experience don’t know what works and what doesn’t. Therefore, it is very important (especially in the beginning) to track everything and to find your strengths/weaknesses.
With that being said, I still think that you should start out as small as possible. In the beginning, you will have to experiment with different things. In other words, you won’t start off by making a lot of money. Therefore, it is essential to not risk a lot in the beginning.
But before you even risk anything, I recommend educating yourself. There is no point in starting to trade if you have absolutely no clue about what you are doing. So make sure to educate yourself before risking any hard earned money. TradeOptionsWithMe has a lot of good free training resources that you could check out.
Not tracking your performance is one of the biggest mistakes I see with inexperienced traders. It’s boring and they’re not digilant enough to keep filling in their spreadsheets, but it is soo important.
I appreciate you’re pointing out that all those expensive software isn’t really necessary and I think a lot of beginners buy it because they think it is only normal to have this so-called specialised software program. Meantime the best solution is in front of their noses all the time: Excel.
I personally use the free Google spreadsheet option and I synced all my sheets in Google Drive. This way I always have access and even if my computer crashes I’m safe.
Thanks for bringing out such a comprehensive guide! Great work!
Thank you for commenting. I completely agree with all your points!
Hello and thanks for the interesting post. I have seen many sites advertising different methods of trading successfully. Although don’t have a lot of experience myself, I like the way you put your points forward very clearly and logically. I have always found options trading an interesting subject and mat visit your site again to learn more in the future. Thanks Kenny
I’ve been an options seller for about 6 or so years, and I always track my trades. I just write them down in a notebook though, because I like to lay them out visually, and its just easier.
I mainly sell Iron Condors, which is a limited risk trade, betting on an underlying staying within a certain range. For example today I sold an Iron condor in FAST, who just had earnings before market open. I sold the November 2018 52.5 puts and the 57.5 calls. I didn’t want to sell them naked, so I also purchased the 49 puts, and the 60 calls, also in November.
For this trade I collected 1.24, so in my notebook I made the following entry.
10/10 FAST Sold Iron Condor for November 2018
49 / 52.5 puts 57.5\60 calls = 1.24
Then when I close the trade, probably at 50% max profit, I’ll make another entry on the same page.
I don’t do this for financial reasons, I just kinda like having a diary, to be honest.
Thanks so much for sharing your process on tracking trades. This really shows the importance of finding what works for you. If you prefer pen and paper over more advanced software, then there is nothing wrong with that.
You trade seems to be a great high probability iron condor. Your options trading seems to be very similar to mine.
I did trading once but I stopped it since I was not doing it good and losing money.
But I think I’ve done it bad, I didn’t track it, well the only thing I did was doing orders at the broker and waiting till the price went good, which was a terrible mistake.
I knew excell was good, never knew however it was a perfect alternative for expensive tracking programs.
Thanks to this post I actually want to trade again, but this time in the good way, and if it takes more time for tracking things and writing them, so be it, but it will be better.
I will bookmark this site, because these kind of posts will help me and a lot of other people!
Great to hear that this inspired you to go back and try trading another time. Just remember to not risk too much in the beginning. It seems to be that you started out like most people. You probably wanted to get into trading and started by making random trades.
It is impossible for a beginner to know what he is doing as he/she has no prior experience. Therefore, I really recommend educating yourself before risking real money.
Thanks for the helpful suggestions. I was at a loss for how to keep up with what was going on. It’s all really too complicated for me anyway. Never thought about Excel. Here we are with almost everyone having the perfect program to track their trades already, and I never even thought about how it could be adapted for this purpose. Thanks.
Happy to help!
Who would’ve thought that something so simple could be so valuable? Thank you for this advice, I will definitely be tracking my trades from now on. I can definitely see the benefit to it now. I’m also happy that I can use Excel as my tracking tool – such a versatile and excellent application.
I couldn’t agree more.
My son is in grade 12 and he is just learning about trading and stocks. He gets me excited about them as well, yet I have no know of how it all works.
He will know more about what you have written, so far he has been consuming anything that is written on trading and stocks.
I have to say after reading over what you have written, excel is a great option. My son is actually going to be doing his first trade today, but like you say we are starting out small.
Awesome! Always remember to not risk too much. I hope the trade is going to be a good one.
Very interesting. I like to trade and I think that it is more important to track it and have reports. You mentioned Excel and I think that it is one great tool not only for making report but also for many other things. I have learned to work in Excel even in the high school so it would not be problem to work on it when it comes to trading.
Excel is a great alternative with loads of features to other software.
Will this work with Google Sheets, like most Excel spreadsheets?
Sadly, as of right now, not all the features work inside Google Sheets.
Let me know if you have any other questions or comments.