My least favorite part of trading is analyzing lists of prior trades; probably because it reminds me that I am not the worlds greatest trader and allows me to see mistakes I have made. I have underestimated it as a learning tool in the past but I have been trying to analyze my trades either quarterly or during corrections since last year. This has reminded me that analyzing prior trades later on can be valuable in exposing trading errors or telling you whether certain time periods are not good times to trade. You may not always pick up on these and really think clearly about them after you just had your stop taken out and had the stock rally 20% without you, or had your breakout reverse the next day on a letter from some suit (hello GS).
I look at all my trades immediately after I close them, I move to the next one pretty quickly and chalk it up to a trade that didn't work. Since the market has gone into a little correction phase here, I thought it was a perfect time to analyze my YTD trades and see if I had some things to improve on. Unfortunately, and fortunately at the same time, I had plenty to see.
I simply took my trade log and calculated my trading accuracy, average winner, and average loser (%). I then calculated an AvgW/AvgL ratio. Then I inserted columns for various Market Monitor indicators (5-day ratio, 10-day ratio, and Primary Indicator Stocks Down raw figure). Any time the 5-day and/or 10-day ratios were >2, the respective column got shaded. Any time the Primary indicator reached bullish extremes (i.e. overbought), that column got shaded. This made it fairly simple to see how I did during certain market phases as dictated by MM. I can clearly see when I did well and when I did not.
In addition, I labeled each trade as either a breakout failure, breakout failure with no follow through, stop and go (takes your stop out and rallies...hate that), trading error, and pre-eps report exit. It is possible for trades that make money to have one of these categories assigned, and trades can end up in more than one category as well.
Without further delay, here's my trading stats for through April 13th. The cumulative gain loss is simply the raw total of my % gain/loss on all trades, it is not my actual portfolio return due to position sizing.
