An important topic in the Trading Coach book is that of keeping metrics on your trading. Common metrics include the number of winning vs. losing trades and the average size of winning and losing trades. More detailed metrics examine the distribution of a trader's returns and the size/duration of equity drawdowns. As part of keeping score, I also like to look at the absolute value of a trader's daily returns expressed as a percentage of the account; this provides a quick and dirty measure of the risk a trader is taking.
The links in the paragraph above will give you a good sense for the metrics that I look at most commonly in my coaching with traders. The goal is to determine:
1) What the trader is doing well and poorly: Many times metrics will illuminate the kinds of trades that are making money and those that are not. This is why breaking metrics down into the instruments/markets traded, the setups traded, time of day, market conditions at the time of trading, and trading size can be very helpful.
2) Trader progress: Tracking a consistent set of metrics over time is a great way of demonstrating your learning curve. It is also very helpful should you ever desire to build a track record for joining a trading firm.
3) Trader effectiveness: Metrics can illuminate your risk-adjusted returns: how much you are making as a function of the risk you're taking. Sophisticated firms know better than to look at absolute returns only. They want traders who make good money per unit of risk taken.
4) When to pull back risk: A shift in your metrics can highlight occasions in which you are no longer trading well due either to changes in how you're trading, changes in markets, or both. Such metrics provide a useful heads up for risk management.
Athletes commonly review tapes of their performances; chess players review their games; professional models watch themselves on screen to refine their presentation; military commanders lead after-action reviews following missions. Everywhere we see elite performance, we see performers reviewing their work as part of ongoing learning. The collection of metrics can serve a similar function for traders.