Retail business, the business of providing services, wholesale business, construction business, and even the kiosk in the shopping mall must have an accounting. If you are a business owner, you are aware of that.
Try to run your business without any bookkeeping. Sounds like an interesting perspective.
Trading is a business as well, and if you don’t keep records, most likely, you will get in trouble with IRS. Just kidding. You will just get in trouble.
Statistics is data collected as a result of the monitoring and recording of certain information.
You might ask; why should I monitor statistical data in trading?
Statistical data in trading is what will ultimately allow you to have an understanding of the effectiveness of the trading strategy or the system as a whole.
You can read about what is a trading strategy, and a system (these are two different things) in the next posts
There is a lot of data that can be collected by recording trading stats, but this is a slightly different story and now we will talk about the main thing.
By paying close attention to statistics, you can understand your mistakes, especially if you keep an in-depth statistical record of your transactions
Here is how you can start to monitor stats:
To get started, just create e table in EXEL, Google Sheets, or Numbers and use it to input information of your entry points, why you decided to initiate a trade, and the result…
This is a template I use for recording my statistics for one of the strategies...
You need to develop a habit of working with statistics, then develop a habit of studying statistics to find mistakes and work on preventing new ones.
Statistics will help you to understand and improve your trading…
You will completely understand your risk tolerance level…
For example, a trader notices that on Tuesdays, the losses account for 90% of his trades although in general, the Trader is profitable ... As a result, the trader stops trading on Tuesdays or reduces the amount of entry into a position to a very minimum. As a result, the trader is becoming more profitable.
Monitor statistical data, work on your mistakes, and later we will talk a lot more in-depth about statistics, and how to use it effectively.
Your trader SAVINSKYI
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My Telegram @Jeck_SAVINSKYI