From Theory To Practice

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Overcoming our Odds

From Theory To Practice

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Last Thursday, we used probability theory to wrap our heads around how often we need to win to simply break-even. In other words, on our quest to ultimately become consistently profitable, what kind of win percentage is needed to overcome the commissions involved in trading. However, that scenario didn’t fully capture some of the particulars surrounding our trading philosophy, such as our preferences for POPs in excess of 50%. In this scenario, it appears that our results will net out to zero and yield a “zero sum” game, but we know this is not the case. Frank, from Frankly Trading, joins us to explain exactly why that is so.

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