Most traders have a trading journal. Very few actually read it.
And of those who do, most focus on the wrong things — scrolling through individual trades, replaying losses in their head, or staring at their overall P&L without understanding why it looks the way it does.
The difference between a trader who improves and one who stays stuck usually comes down to five numbers. Learn to read these five metrics in your own data, and you'll have more clarity about your trading than 95% of people in the market.
1. Profit Factor
If you only track one metric, make it this one.
Profit factor is your total gross profit divided by your total gross loss. A profit factor of 1.5 means you made $1.50 for every $1.00 you lost. Below 1.0 means you're losing money overall.
Why it matters more than win rate: A trader with a 40% win rate and a profit factor of 2.0 is far more profitable than one with a 70% win rate and a profit factor of 0.9. Most traders optimize for win rate because winning feels good. Profit factor is what actually pays the bills.
A healthy profit factor for most trading styles sits between 1.4 and 2.5. Anything above 3.0 on a meaningful sample size is exceptional. Below 1.2 and you need to look hard at either your entries, your exits, or both.
2. Expectancy
Expectancy is the average dollar amount you expect to make (or lose) per trade, calculated across your entire history.
The formula: (Win Rate × Avg Win) - (Loss Rate × Avg Loss)
If your win rate is 55%, your average win is $200, and your average loss is $150, your expectancy is: (0.55 × $200) - (0.45 × $150) = $110 - $67.50 = $42.50 per trade.
That means every time you press the button, your expected outcome is positive $42.50 — over hundreds of trades, that compounds into real edge.
The insight most traders miss: Negative expectancy doesn't just mean you're losing money. It means every trade you take makes you poorer in expectation. Volume is the enemy of a trader with negative expectancy.
3. Win Rate — In Context
Win rate gets far too much attention and far too little context.
A 60% win rate sounds great. But if your average win is $80 and your average loss is $300, you're losing money. A 35% win rate can be highly profitable if your average win is $500 and your average loss is $150.
Where win rate does matter: in identifying your best and worst conditions. Don't look at your overall win rate — slice it by:
- Time of day (your 9:30-10:00 AM win rate vs your 2:00-4:00 PM win rate)
- Day of week (Monday vs Thursday)
- Instrument (NQ vs ES, or crude oil vs gold)
- Setup type (breakout vs mean reversion)
When you find that your Tuesday win rate is 62% but your Monday win rate is 29%, that's actionable information. Most traders never look this deep.
4. Max Adverse Excursion (MAE)
This one is underused and extremely powerful.
MAE measures how far against you a trade moved before it came back and became a winner. Track this across all your winning trades, and you'll see a pattern: most of your winners never moved more than $X against you before going in your direction.
That $X is your real stop-loss level — the level the market has told you, through actual results, that you should be using. Not the stop you "feel" is right, not the one based on a round number, but the one based on how your winning trades actually move.
If you find that 90% of your winners never moved more than $150 against you, and you're using $300 stops, you're giving trades twice as much room as they need. Tighten to $175 and your risk-reward ratio improves dramatically without hurting your win rate.
5. Time-Based P&L Breakdown
The final metric isn't a single number — it's a breakdown of your P&L by time.
Every trader has a best session and a worst session, and they almost never match the trader's intuition about which is which. The Open (9:30-10:00) looks like the best time to trade because it's the most exciting. But for most traders, it's their worst session.
Pull your P&L broken down by:
- Session (pre-market, open, mid-day, power hour, close)
- Hour (9:30, 10:00, 11:00, 12:00... etc.)
- Day of week
You'll likely find one or two sessions that generate the vast majority of your profits — and one or two that destroy them. Once you know which is which, you can stop trading your losing sessions entirely and focus energy where your edge actually lives.
Putting It Together
These five metrics — profit factor, expectancy, contextualized win rate, MAE, and time-based P&L — give you a complete picture of where you make money and where you lose it.
The challenge is that calculating all of this manually from a spreadsheet takes hours. Even then, you're often missing the patterns because you're looking at too small a slice of data.
This is why we built the AI Coach in MyTradersEdge. Upload your CSV trades and within seconds you get a full breakdown of every one of these metrics, plus an AI coaching report that identifies your specific patterns, leaks, and a concrete improvement plan.
No credit card required. Full access from day one.