Zerodha rolls out new feature allowing investors to tag trades, track profitability
Zerodha introduces a new feature that allows investors to mark trades and track profitability
Key highlights
- The tagging function was added to the retail reporting platform by Zerodha, Console. added
- Tagging your trades and keeping a trading journal can help you become a better trader, says Nithin Kamath
- Similar to tags in the income statement, you can either tag the entire quantity of a specific security with a specific tag
New Delhi: Online brokerage company Zerodha has introduced a new feature on its platform that allows investors to mark their trade or take a note for taking a trade and track profitability. Tagging functionality has been added to Zerodha's retail reporting platform, Console.
The brokerage firm launched Console 2.0 earlier this year, a complete rewrite of its entire back office and reporting system from the ground up. "We're ... excited to announce a new Nudge on Console - portfolio and trade tagging that can be used as a trading journal and to track your investment goals," the company said in a recent statement.
"Mark the exact reason for entering into a trade on the income statement or on the inventory / position page which can serve as your trade journal that also shows your performance," Zerodha said in a related article posted on June 1 was published on its website.
Zerodha co-founder and CEO Nithin Kamath tweeted: “We @zerodhaonline are excited about the new tagging function on the console. Tagging your trades and keeping a trading journal can help you become a better trader and help you pursue your investment goals. "
New functions in the console:
Trade journal with tags:
Now investors can use tags to manage the trading journal. You can write down the reasons for a particular trade or investment. It could be based on any factor - gut feeling, indicator based, advisor based, PE based, etc.
One can review these notes from time to time to find out what is making profits and what is making losses. You can now do this very easily using the "Tags" function in the console. Mark the exact reason for closing a trade in the income statement or on the "Holdings / Positions" page and act as your trading journal that also shows your performance.
- Go to the P&L report on the console to tag.
- Click the context menu next to a security in the income statement and select Show Breakdown / Tags.
- In the P&L Breakdown window, click Create and apply a day to all trades.
- Enter the name of the tag and add a description of the tag you want to create and click Save
The tag name is limited to 15 characters as different reports and platforms use the tags in multiple places for display purposes. You can elaborate on the tag in the description field. You can apply this tag to all trades for this instrument in the breakdown (different trades that resulted in P&L) or separate tags for each breakdown by clicking Edit Tags.
According to Zerodha, it can take a few minutes for applied tags to be applied. After tagging, you can use the tag filter on the P&L to see the profitability of your tags. You can also keep track of your best and worst performing tags in Tag Manager. Note that your tags are marked with Trades. If you are looking for a P&L period outside of the marked trading dates, you will not see any result.
Targets with tags:
While tags can be used as a trading journal, you can also use them to track investment goals. Just as you can mark income statement, you can do the same with your stocks and MFs. You can tag your possessions with goals like - retirement, parenting, vacation, and more. You can then track these on the inventory page.
To create targets, go to the inventory page in the console. Click the context menu next to the stock you want and select Show Breakdown / Tags.
Tagging of stocks:
Similar to tags in the income statement, you can either mark the total amount of a specific security with a specific tag or the breakdown (purchase transactions that led to the hold). Once tagged, you can filter your portfolio by tags on the holding page to help track your goals.
You can mark the total quantity or the breakdown when marking from your inventory page that resulted in your total inventory. You cannot make your own breakdown of stocks and mark them differently and the actual trading history will always be marked. When you leave your stocks, be sure to mark your exit trades from the P&L breakdown as shown earlier. The tag-based P&L only works if both entry and exit trades are marked.
Tag analytics:
This page provides an overview of your best and worst performing tags, as well as a list of all the tags you have created. You can see this screen by clicking on “Tags” under “Portfolio” on the top bar of the console.
Why is it important to keep a trade journal?
Zerodha stated on his blog that while trading markets seems easy, it is not. It is actually the hardest way to make easy money. So, if you don't analyze your weaknesses and mistakes and try to get better every day, you can potentially lose money to the markets indefinitely. Using tags to start a trade journal can greatly aid in your trade and investment journey.
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