Trading journals: gross results, net results and flows

The essentials

A journal separates instrument results, costs and capital contributions. Balance can rise from deposits despite losing trades. Define a convention to avoid deducting commission twice when reports already include it.

Understand the mechanism, not just the definition

A journal explains decisions and conditions rather than collecting winning screenshots. Keep context, hypothesis, execution, costs and process compliance. Separate gross and net over the same period. A good-trade label should describe process quality, not merely a profitable ending.

Example and verification

Hypothetical example: gross result 50, commission 6 and funding 4 leave 40 before other costs. A deposit of 100 does not make profit 140. Separate trades from capital movements.

Worked case, step by step

A hypothetical sample wins 60% with average gain 10 and loses 40% with average loss 20. Gross expectancy is 0.60×10 − 0.40×20 = −2; an additional average cost of 1 makes it −3. High win rate can coexist with negative results. A small sample is not a forecast; use it to identify variables for review.

What to verify when applying this

Record date, symbol, size, feed, costs and closing reason. Compare periods consistently and keep data private. Organization helps dispute errors but a short sample does not establish future returns.

Practice: verify it in your environment

Learn by observing the process and keeping its data. Complete this practice in demo or using documentation, without sending real orders or adding capital for the exercise. Record differences between the example and your account specifications.

1. Record a pre-trade reason and subsequent review without rewriting the hypothesis afterward.
2. Calculate metrics separating costs and external cashflows from trade results.

Test your understanding

Try the question before revealing the answer. Justify the conclusion and its assumptions rather than memorizing a number.