Which statistics to track in your trading journal
Win rate, expectancy, risk/reward ratio, drawdown: what each metric really says about your trading, and which one to watch first.
A journal generates a lot of numbers. Four are enough to steer your progress.
Win rate: necessary but misleading
The percentage of winning trades is the first metric everyone looks at — and the most misread. A 40% win rate can be comfortably profitable if your winners return three times what your losers give back. Conversely, a 70% hit rate can ruin an account if the rare losses are enormous.
Risk/reward ratio (R:R)
This is what you win on average relative to what you risk. An R:R of 2 means your average gains are worth twice your average losses. Paired with win rate, it determines whether your system is viable at all.
Expectancy: the real arbiter
Expectancy is your average gain per trade, expressed in R. The formula is simple:
Expectancy = (win rate × average win) − (loss rate × average loss)
A positive expectancy means that, statistically, every trade pays you. It is the one metric that summarises the profitability of your approach on its own.
Drawdown: your tolerance for risk
Drawdown is the largest fall in your capital from a peak. It measures the pain your system puts you through. A drawdown you cannot stomach psychologically will make you abandon an otherwise profitable system — a subject we cover in why I break my trading discipline.
Computing them without effort
Calculating these metrics by hand is tedious and error-prone. Altiora computes them automatically from your imported trades and displays them on a clear dashboard. To understand the whole picture, go back to the complete trading journal guide, or try the platform for free.
