Why One Loss Can Shift Your Trading Win Rate

Summary

Hollow Point Trading shares how a single loss can shift a small-sample win rate: eight wins in ten trades is 80%, but eight wins in eleven is about 72.7%. The short explains why observed results from a few trades do not prove a strategy’s true future probability, an important reminder when evaluating performance.

https://youtu.be/h3ZIsZ8rYtQ

One loss can sharply move a tiny win-rate sample #Shorts

Why One Loss Can Shift Your Trading Win Rate
Eight wins out of ten trades looks like an eighty percent win rate. But a small sample can move sharply with just one observation. Imagine the next trade loses, leaving eight wins out of eleven. The observed win rate is now about seventy two point seven percent. Nothing about that arithmetic proves the strategy's true future win probability. The...

trading win rate small sample size trading statistics win rate calculation probability in trading trading strategy risk management

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