Trading metrics and terms, explained

What is a trading plan: identity, markets, entry/exit rules, risk sizing, review routine, and how journaling proves whether you follow it.

What percentage of day traders are successful? Real stats (1–13%), why numbers mislead, five hurdles, and a journal-backed plan to improve your odds.

What is MFE (Maximum Favorable Excursion)? Learn how to calculate it, read real trade examples, and use MFE data to improve exits and profit targets.

Day trading tax deductions: trader tax status, Section 475, mark-to-market, deductible expenses, record-keeping, and why a journal supports audits.

What is backtesting: replay strategies on historical data, key metrics, pitfalls like overfitting, and how it pairs with paper trading and journals.

What does P&L stand for: profit and loss basics, realized vs unrealized, how to calculate trading P&L, and tools to track it automatically.

Trading plan template: goals, setups, entry/exit rules, risk limits, and review routine — plus how to track adherence with a journal.

Loss ratio formula explained for insurance and trading: calculation, benchmarks, limits of one metric, and pairing with win rate and profit factor.

What is market volatility: causes, VIX, high vs low regimes, and practical ways traders and investors manage unpredictable price swings.

How to calculate return on investment: ROI formula, annualized returns, trading costs, and why net P&L beats headline percentage gains.

Maximum drawdown (MDD) explained: peak-to-trough loss, formula, why it matters for risk, and how to track it in your trading journal.

Risk management for traders: position sizing, stop losses, drawdown limits, psychology, and tools to stay disciplined under pressure.

Win rate formula for traders: wins ÷ total trades, common counting mistakes, and why expectancy matters more than percentage alone.

Practice trading with fake money on a free paper account. Set up TradingView or thinkorswim, size positions, journal trades, and know when to go live.