Tag Archives: Expectancy

You Won’t Be Successful Until You’re Ok With Losing!


A VERY common theme amongst the email Q&A I get from new and developing traders is the frustration that comes from having a losing trade.

They typically want to know where they went wrong. Or what they should have done better.

Often though… there was NOTHING wrong.

Losses happen.


This is not a game of winning every trade.

Trades are not taken because of any belief in certainty; but rather because our assessment of the odds and potential payoff deems them to be worth the risk.

And success comes through managing both winners and losers, such that we profit over a series of trades.

Winners AND losers.

You will get both.

Sometimes they lose:

You won't be successful until you're ok with losing

You won't be successful until you're ok with losing

You won't be successful until you're ok with losing

You won't be successful until you're ok with losing

Sometimes they win:

You won't be successful until you're ok with losing


WLSR – Not Win%


I've covered quite a few topics throughout 2014, but I believe the most important by far has been my attempt to have people looking for success over a series of trades, rather than on any individual trade.

Not every trade idea works!

But that's ok and that's normal. Keep the losses contained. And work to ensure those that do win are larger (on average) than those that lose.

Your aim is to have more focus on the Win/Loss Size Ratio (WLSR) and less on the Win Percentage (Win%).

Your aim is to focus on profits over a series of trades with less concern for results on individual trades (win or lose).

Focus more on WLSR and less on Win%


Expect Imperfection – Part Two


I always liked this passage from Street Smarts by Linda Raschke and Larry Connors:

"No matter how long you trade, you'll never do it perfectly. Case in point. A friend of mine is a retired market wizard. This man has made over $100 million trading futures. He told me that his biggest weakness was that he never mastered his exit strategy!"

In last Friday's newsletter we explored the idea that imperfection in decision making and outcome will ALWAYS be a normal part of our trading. (See here if you missed it!)

Only a few hours later as Friday's session commenced, I experienced the following trade. Naturally I had to share it as well.  🙂


Expect imperfection

Expect imperfection


Expect Imperfection


Imperfection is part of the game. Expect it.

While you should always seek to minimise error and to improve your market reading skill and decision making abilities, you cannot ever completely eliminate imperfection.

Instead, your job is to learn to profit over a series of trades, despite the presence of imperfect decisions and actions.

Expect imperfection