Do you want to make long term profits from crypto trading? Well, how do you measure your trading performance? What are the standards do you use to measure your trading performance. Well, most of the traders only consider it in terms of total money made and lost. Further, some traders even don’t consider them on a regular basis.
In fact, it is very important to measure your trading performance to sustain and gain profits in the long run. Now read on to understand how to measure your performance. Before that, I would like to shed some light on trading performance.
It’s challenging to analyze a typical performance report contains a large number of statistical data.
Trading performance is used to measure the return to the risk tolerance of a trader. There are certain key factors that are considered in the performance evaluation. Different types of traders such as day traders, scalp traders, swing traders use different performance metrics. It’s challenging to analyze a typical performance report contains a large number of statistical data. A performance report consists of majorly the following things, review this report after trading.
Analysis of Performance Report
The performance report includes five major things that can help you to figure out what are the things that you need to consider.
- Winning Trades: Check what is the number of winning trades on a daily, weekly, and monthly basis. This will help you to navigate your target or trading goals. That means if you have more winning trades for a certain period of time then you can raise your trading goal and target. If you are getting less number of winning trades then you can set the trading goals accordingly.
- Losing Trades: The number of losing trades helps you to manage your risks. If you have fewer losing trades then you can raise your risk otherwise you should take less risk.
- Net Profit/Loss: This gives you the overall idea of your risk and reward. Check the daily, weekly, and monthly profit and loss statements. This will help you decide your risk-reward ratio accordingly.
- Highest Winning Trade: This boosts your confidence; you need to learn which trading strategy you have used and how much profit you have made from this trade.
- Highest Losing Trade: Never forget and repeat your mistakes. Note down this trade why this trade has gone wrong, what mistake you have done.
Well, there is nothing wrong with this but you are not going to visualize the accurate picture. Most of the crypto traders use the bitcoin profit calculator to measure their trading performance. Anyway, you need to use some other data to clearly visualize your performance.
Review Performance Graphs
One way of visualizing your performance is to review your performance graph. The graph indicates how consistent you are with your profits. Look at the chart and find whether you find a rise of fall in your performance. When you look at your performance chart, check whether you are hovering around a certain range. Then you need to modify your trading strategy to break that zone.
Important Tips to Improve Your Performance
Well once you analyze your performance, you need to modify your strategy to improve your performance. For that, keep these following things in mind.
- Set Your Baseline
Don’t look for short term goals, plan for the long term. If you look at the bigger picture then you can set your baseline effectively. How much is the minimum target you want to set for yourself, set that baseline?
- Track Your Progress
Always keep tracking your progress with your risk and reward. Check whether you have earned the ability to raise your risk?
- Raise Your Bar
Raising your bar means you need not to worry about how much money you should make from a single trade. You need to be very realistic and challenge yourself to improve your performance on a regular basis.
Finally, don’t overanalyze your trading performance. Just keep it simple set your standard, track your progress, and raise your bar. Stick to this simple formula consistently for a long time, you will definitely see good results. Remember, trading is risky so always start with the amount that you can afford to lose. Don’t forget to share your opinion on this.