A trade log tracks the number of trades, wins, losses, and profits, but additionally, and more importantly, it tracks trading statistics such as win-rate, reward:risk, and efficiency, each day and over many days. A trade log provides insights into our trading, and opportunities to improve, which may otherwise go unnoticed.
Below is a forex day trading trade log for 2021. There is a different tab for each month of the year at the bottom of the Excel spreadsheet.
Downloadable Forex Day Trading Log in Excel for 2021
There are programs that you can connect to your forex day trading account to track various statistics and performance. MyFXbook is one such site. Although if you don’t use MetaTrader that may not be an option. Also, by tracking our own statistics we can track things that automated programs can’t.
In this downloadable forex trade log I have included “Efficiency” along with win-rate, reward/risk, and of course profitability. Efficiency is an important metric to track, yet is almost never discussed.
Efficiency is how well we actually trade relative to what we would make if we traded our trading plan (strategies) optimally. Efficiency helps show us how much our mistakes are costing us.
For example, we may review our day trading chart in the evening and see that we could have made 5% on the day if we stuck to our strategies. But in reality, we skipped one of the trades, or didn’t see it in real-time, and so our actual profit was only 3%. We made 3% of an available 5% (based on our already established methods) so our efficiency is 3/5=60%.
I typically track efficiency as my actual return versus the theoretical return of the trading plan. If the two match up, efficiency is 100% which is our goal. If I take a trade that I know I shouldn’t have, then that is a mistake, and I will manually input that. For example, in this case, if I took 5 trades but my plan said to only take 4, then efficiency is inputted as 4/5 =80%.
Here are all the stats included in the downloadable forex day trading log Excel sheet:
- Starting account balance for that day
- The percent you can risk on each trade (typically 1% of account balance). This amount is called R.
- Number of round trip trades taken during the day.
- Number of wins.
- Number of losses.
- Win Rate %, which is # of wins / # of trades
- R Won is how many Rs you won when you add up only winning trades. For example, if you risk 1R on a trade, and you win a trade with a 2.5:1 reward to risk, you are up 2.5R.
- R Lost is how many Rs you won when you add up only losing trades.
- Average R Win is the average of how many R are won on the winning trades. Calculated as R Won / # of Wins
- Average R Loss is the average of how many R are lost on the losing trades. Calculated as R Loss / # of Losses
- Reward:Risk (R:R) is Average R Win / Average R Loss. This tells us how profitable our average win is relative to our average loss.
- Profit R is the daily profit expressed as R.
- Potential R is our potential profit if we followed our trading plan exactly and executed all the trades well.
- Efficiency is either our Profit R / Potential R, or it is the number of trades we should have taken / what we actually took. The max of this 100%, so depending on the mistakes made, or if we made more profit than we theoretically should have, we may need to manually input a figure to account for inefficiency. We don’t want to give ourselves 100% if we made a mistake and ended up making more than we should have.
- Profit $ is gross dollar profit based on what our trading platform says. If you pay commissions, add them back in for this number.
- Fees are our commission costs. Add up the costs shown in the trading platform for the day. If you don’t pay commissions, don’t include this.
- Net Profit. This number is from our trading platform but is also Profit $ – Fees.
- Actual R is our R profit when including commissions. Calculated as Net Profit / R
- Amount Traded is the dollar value of currency traded during the day. If you took 1 trade of 100,000 (one standard lot) remember to double it, because you bought and sold it. Total traded is 200,000 in this case. This number is to tell your friends and freak out your mom.
- Ending Balance is the actual balance in your account at the end of the trading day. It should be Starting Balance + Net Profit
- Time Traded is how many hours were spent trading. I typically limit my forex day trading to 2 hours to 2.5 hours, for example.
- Average Leverage is to track how excessively leverage is being used. It is calculated as [(Amt Traded /2) / # of roundtrip trades] / Starting Balance
- There are Totals along the bottom. Some are sums and others are averages, where applicable. Some values need to be put in manually.
I added in some sample data on each page of the excel file to give a sense of the metrics.
This spreadsheet is tracking quite a bit. Some items seem redundant. Profit R and Profit % are similar but use different language. Profit % is telling us exactly how many percent we made on our account. Profit R is measuring profit to risk. If we risk 1% per trade (R), and make 4R, we make 4%. If we cut our risk in half—R becomes 0.5%—and we make 4R our percent profit is 2%. Profit R is standardized for risk, while Profit % is standardized against the account balance. Both are important.
Add in or take out metrics based on your needs. But ideally, using all these metrics will provide insight into your trading and highlight where you need to improve.
Using the Trade Log for Trading Improvement
A trade log provides all sorts of insights that go unnoticed if it isn’t used.
If the win rate is low, and profits are sluggish or negative, we can dig into that to find ways to improve our strategy:
- Is the price moving your direction but not hitting the target? If yes, the target is too aggressive for that entry. Or possibly you are entering too late in a move, or too early. A less aggressive target, or a better-positioned entry, will improve the win rate.
- Is the price almost immediately going against you, but then eventually going in your expected direction? If yes, more patience is required. Add criteria into your trading plan that make you wait for the trade setup to more fully develop before jumping in. This will improve the win-rate.
These are examples of questions you can ask yourself, based on problem areas you see in your trade log.
Efficiency is likely another big problem area. If we can’t follow our plan, how can we expect to be really good traders when we are handed (or develop) an amazing strategy/plan? Establish a daily routine to help stick to the trading plan. A Peak Performance workshop I attended also had lots to say about how to improve efficiency and performance.
Reward:risk is another big problem area for many people. Most struggling traders tend to exit winning trades too early. They panic out of winners and hold onto losers. It doesn’t matter what the R:R is going into a trade if we don’t stick with it. The actual R:R based on closed trades is what matters to profitability. Combined with win rate these statistics tell us a lot.
If you have a low win rate, the simplest solution is to hold onto winners and try to extract more profit from the trades that do work out. If the win rate is high, make sure to keep actual losses smaller than actual gains. A high win rate means nothing if we lose everything on a few big losing trades.
The EURUSD provides great day trading movement and loads of opportunity. Capitalize on it by trading your best and keeping a trade log in 2021.
By Cory Mitchell, CMT
New to forex? Want to get started or learn more? Check out the Forex Introduction Course.
Disclaimer: Nothing in this article is personal investment advice, or advice to buy or sell anything. Trading is risky and can result in substantial losses, even more than deposited if using leverage.