Beginner · 8 min read

Psychology, journaling and what paper trading can't teach

Why the journal matters, how paper and real trading differ, and what SEBI's studies say about results.

What the research says

SEBI's published study of individual traders in the equity futures and options segment found that about 9 out of 10 incurred net losses. On average, loss makers lost close to ₹50,000, and spent an additional 28% of their net trading losses on transaction costs. Those who made profits spent between 15% and 50% of those profits on transaction costs. Read this carefully before you risk real money.

Why keep a journal

• Memory is selective. A journal records what you planned, what you did and why.
• Tags show patterns: which setups pay off, and which mistakes cost you most. The Reports tab adds up the cost of each tag.
• Noting 'Did I follow my plan?' separates bad outcomes from bad decisions.

Where paper trading differs from real trading

• Emotions: losing real money feels very different; paper trading cannot reproduce fear or greed.
• Fills: real orders face slippage, partial fills and wide spreads; paper fills are simplified estimates.
• Margin and charges: real margin can change during the day; paper margin and charges here are estimates.
• Discipline: it is easy to take big positions when nothing is at stake. Treat your paper account as if it were real, with the same size and rules.

Caution. Good paper results do not predict real results. Use paper trading to learn mechanics and to test whether you can follow a plan, not as proof that a method works.