What is Conviction Score?
A conviction score is a 1–5 (or High/Medium/Low) self-rating assigned before entering a trade, capturing how strongly the setup meets the trader's criteria. Over time, comparing conviction scores against outcomes tests whether the trader's subjective judgement adds value — whether their high-conviction trades genuinely outperform low-conviction ones.
Indian market context (NSE)
Reference levels: Nifty 50 at 24,300, Reliance Industries at ₹1,300, Bank Nifty futures at 55,000 (lot size 30). Examples below show how Conviction Score shows up on Indian index, equity, and futures books — update to live quotes in your journal.
Nifty 50 perspective
Conviction Score often appears after Nifty moves 150+ points from open while you waited — journal “Nifty FOMO” entries separately from A-grade setups at 24,300 levels.
Reliance Industries perspective
Conviction Score on Reliance trades is common around results noise at ₹1,300 — rate discipline 1–5 in TradeLyser even when P&L is green.
Bank Nifty futures perspective
Conviction Score after Bank Nifty whipsaws 200 points around 55,000 triggers revenge sizing — enforce max daily loss before re-entering MIS.
How to validate
- Validate Conviction Score tags against time-stamps — impulse entries cluster after losses.
- Compare P&L on tagged vs untagged sessions over 20+ trading days.
- Use mentor review to confirm tag definitions stayed consistent.
- Do not validate solely on one exceptional week of discipline.
How to track in TradeLyser
- Add psychology grade and Conviction Score-related tag on each trade card.
- Use daily journal mood line when Conviction Score risk is elevated.
- Dashboard: count psychology violations per week alongside P&L.
- Share tag definitions with mentor before monthly review.
Best practices
- Separate process score from P&L when reviewing Conviction Score.
- Use cooldown timers after rule breaches involving Conviction Score.
- Sleep on size increases — never add risk the same day as a Conviction Score violation.
- Celebrate disciplined losses that followed the plan.
Common pitfalls
- Labelling trades after the fact to match desired self-image.
- Increasing size to fix a Conviction Score episode immediately.
- Confusing a green day with cured Conviction Score behaviour.
- Skipping tags on “small” impulsive trades.
Reference guide
| Context | Value | Reading |
|---|---|---|
| Conviction correlation | High-conviction trades show meaningfully better expectancy — intuition has edge | No correlation or inverse correlation — sizing uniformly until pattern improves |
Related terms
An emotion grade is a subjective rating (typically 1–5 or a categorical label such as Calm / Nervous / Overconfident / Revenge) that a trader assigns to each trade or session to capture their emotional state. Over time, emotion grades reveal which states correlate with rule breaks, overtrading, or underperformance.
An execution grade is a subjective rating (A/B/C/D or 1–5) assigned to a trade to evaluate the quality of execution relative to the plan: did you enter at the right level, size the position correctly, manage the trade per the rules, and exit at the right time — regardless of the outcome? Good execution on a loser is still an A-grade trade.
A mistake log is a structured record of every identifiable trading error, categorised by type (rule break, overtrading, poor sizing, premature exit, emotional entry, etc.) and maintained alongside the regular journal. Regular review of the mistake log identifies recurring patterns that persist across setup tags and sessions.
An R-multiple expresses outcome as multiples of the risk you planned at entry. +2R means you made twice your predefined stop amount; −1R is a full stop-out.
A trading journal is a systematic record of every trade a trader takes, documenting instrument, setup, entry and exit prices, position size, P&L, emotions, and rule adherence. It is the primary tool for identifying patterns, diagnosing mistakes, and proving whether an edge exists after costs on NSE and F&O books.
FAQ
Should I trade smaller on low-conviction setups?
Only if your journal data confirms that low-conviction trades underperform. If there is no statistically significant difference, uniform sizing is optimal — varying size based on intuition that has no proven track record is a form of gambling. Let your journal tell you whether your conviction grades are predictive.
How does TradeLyser use conviction scores?
TradeLyser lets you assign a conviction score to each trade before entry. The Analytics section shows win rate, expectancy, and average R broken down by conviction level. This is one of the most insightful reports for traders trying to determine whether to vary position size by setup quality.
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