# Case: audit a journal and find the leak > Read a month of trades, find where the money leaks and write the one rule that would have fixed most of it. - Course: [Trading Basics: How It Works, How Not to Lose Everything](https://productovi.com/courses/trading.md) - Module: How do I turn an idea into a plan I can test? - Lesson 28/32, ~40 min - Source: https://productovi.com/courses/trading/audit-a-journal ## Nora's March **Alex Tutor:** Back on your Pebble practice account, it's audit day. Nora kept a journal for all of March, 40 trades, and wants to know where the money went. ![Blue pebbles pour into a bucket while others slip out of a small hole near the bottom. Nora holds her head, Marc points a magnifier at the hole and Alex hands over a patch.](https://productovi.com/courses/trading/diagrams/m7-l4-scene.png) **Nora:** Down 2,190 in one month. My plan risks 1% of 10,000, so 100 a trade. I think the plan is broken and I need a new entry rule. **Alex Tutor:** Maybe. Or maybe the plan is fine and something else leaks. An audit doesn't start with a new rule. It starts with splitting the journal. **Dataset (CSV):** [Nora's journal, March 2025](https://productovi.com/datasets/trading/audit-a-journal/m7_journal_leaky.csv) 10,000 practice account. Plan: risk 100.00 to the stop, exit at the stop on a loss. Fees 2.00 per round trip; result is after fees. **Marc:** I'd split it by the plan_followed column first. Two piles: trades done by the plan, trades that broke it. Then add up each pile. > **Exercise:** What is the total result of the trades with plan_followed = yes, after fees, in dollars? > **Exercise:** And the total of the trades with plan_followed = no, in dollars? ## Where the money leaks **Nora:** Wait. The plan trades made money? **Alex Tutor:** Plus 1,428 on 31 trades. Just past 30, so it's an early sign, not proof. But the 9 breaks lost 3,618, two and a half times what the plan earned. Now look at when they happened. ![Nora's March after fees: 31 plan trades made +1,428, 9 plan breaks lost 3,618, so the month ended at −2,190. The loss came from the breaks, not from the plan.](https://productovi.com/courses/trading/diagrams/m7-l4-plan-vs-breaks.png) **Alex Tutor:** Before we look at the breaks: how much did an average plan trade make? > **Exercise:** In Nora's journal, what is the average result per trade of the 31 trades with plan_followed = yes, after fees, in dollars? Round to cents. **Nora:** I remember those days. After a loss I just wanted the money back before lunch. **Alex Tutor:** That feeling is normal. The journal isn't here to judge it, only to show what it costs. **Sofia:** Trade 5 at 11:51, twelve minutes after trade 4 lost. Trade 11 at 09:51, seven minutes after trade 10 lost. Same pattern again and again. **Alex Tutor:** Now compare the size and the stop of each break with the plan. Something else repeats. > **Exercise:** What do the 9 plan-breaking trades have in common? Pick all that apply. **Alex Tutor:** That's **revenge trading**: right after a loss, going bigger to win it back fast, and refusing to take the next loss. The plan's 100 becomes 400 or 500. ![10 March: trade 10 lost the plan's 102 at 09:44. At 09:51 and 10:03 two trades with 200 at risk lost 582 and 402. Then trade 13 followed the plan again.](https://productovi.com/courses/trading/diagrams/m7-l4-revenge-day.png) **Sofia:** Why move the stop, though? **Alex Tutor:** Because a second loss within ten minutes feels unbearable, so hope takes over. Hope has no exit price. **Alex Tutor:** Let's put a price on one moved stop. Take trade 5. > **Exercise:** Trade 5 in Nora's journal: 50 shares, entry 56.25, planned stop 52.25, actual exit 45.45, fees 2.00, result −542.00. How many dollars more did it lose than if it had exited at its planned stop? **Nora:** But trade 18 worked! Plus 238. **Alex Tutor:** One win in nine. A habit that wins sometimes is the hardest kind to drop. Let's price it: what if those 9 had been ordinary plan trades, normal size, out at the stop? > **Exercise:** If each of the 9 breaks had used the plan's size and exited at the planned stop when it lost, they would have made −698.00 together. What would the month's result have been, in dollars? ## One rule **Alex Tutor:** So the leak isn't the entry rule. It's what happens in the minutes after a loss. A new entry rule would keep the leak and throw away the part that works. ![Running total of Nora's 40 March trades: as traded it falls to −2,190. With the 9 breaks done by the plan, the same entries end the month at +730.](https://productovi.com/courses/trading/diagrams/m7-l4-month-equity.png) **Alex Tutor:** A good fix has three marks. It targets the moment of the leak. It can be checked yes or no. And it's hard to break in the heat of the moment. **Nora:** What makes a rule hard to break? **Marc:** For me: the stop goes in with the order, never later. And after a loss I close the app and write the journal line first. By the time it's written, the urge has passed. **Alex Tutor:** Which fix fits the leak best? Four candidates from Nora's notes. > **Exercise:** Nora's March leak: 9 trades taken minutes after a loss, at double size, with the stop moved. Which single rule fits it best? **Marc:** And a month of journal is like a backtest of your own behavior. Same question afterwards: what could be wrong? One month, 40 trades, practice money. The pattern is clear; the plan's edge isn't proven yet. **Alex Tutor:** One last check on Marc's point about what a month can and can't show. > **Exercise:** Nora's 31 plan trades made +1,428 in March, so the audit proves that her plan makes money. > **Exercise:** Nora says: "I lost 2,190, so my entry rule is bad. I'll find a better one." In 2–3 sentences, explain with the journal's numbers why that's the wrong fix. **Alex Tutor:** Now the case. Nora wants an audit she can pin above her desk. **Nora:** Short, please. Where's the leak, and the one rule I should add. And how do I stop myself breaking that one too? > **Exercise:** Write Nora a short audit of her March journal. > **Educational, not advice** > > This lesson is educational, not advice. Fixing a leak doesn't make trading profitable: most people who trade lose money, and you can lose all of it. For taxes and rules, check with a licensed professional where you live. - Previous lesson: [Practice account, starting small and the journal](https://productovi.com/courses/trading/practice-account-and-journal.md) - Next lesson: [Fear, greed, hope and revenge trading](https://productovi.com/courses/trading/fear-greed-revenge.md) --- Productovi Learning. Free, no sign-up needed to read.