In the trading market, many novice investors overly focus their energy on how to accurately predict market trends. Some people's predictions may seem very accurate, but their accounts may not necessarily yield substantial profits.
It is generally believed that a win rate greater than 50% guarantees a win, but in reality, it is very difficult for ordinary people to achieve a win rate greater than 50%. Often, a win rate of 30%-40% can basically be considered as a skilled trader. The question arises, how can one profit with such a win rate?
This involves a concept called ---- profit-loss ratio.
For example:
Assume making 7 wrong trades, losing 3% each time, and making 3 correct trades, gaining 9% each time.
Total return = (3×9%) - (7×3%) = +6%
A win rate of 30% actually resulted in a profit. This means that what matters is not whether you are right or wrong, but how much you earn when you are right and how much you lose when you are wrong. The market will not reward you for guessing correctly a certain number of times; it will only pay those who strictly adhere to discipline, manage losses timely, and let profits run.
Those who stubbornly hold onto losses and prematurely take profits will ultimately be drained by volatility. It is never the wrong direction that leads to liquidation, but the loss of control over position size and stop-loss.
Therefore, in trading, you should use stop-loss to buy the right to experiment, use trailing stop to catch swing trends, forget about win rates, and focus on the profit-loss ratio.
Welcome fellow traders to share your trading tips in the comments.
#交易技巧 #盈亏比制胜 #交易心得
