TRADING A GAME OF PROBABILITY

TRADING A GAME OF PROBABILITY
We know that market has random movements; the pattern behaved in the past cannot behave exactly the same next time so in a random market environment there are so many external factors that can affect the outcome of the trade, a trader cannot know all those factors. What you know is your EDGE (your strategy) which is certain in an uncertain market environment, If your edge has a positive outcome you can produce a consistent result in a random environment.

HOW TO PRODUCE CONSISTENT RESULT IN A RANDOM ENVIRONMENT
An event that has a probable outcome can produce consistent results if you have the odds in your favor and there is a large enough sample size. (a series of trades generated by your edge). You have to think in probabilities and take every single trade which meets the criteria of your system (your edge); you don’t know the outcome of any trade before taking the trades (you don’t know which trade is going to be a winner or loser) unless you know a way to travel in time so, you cannot select between the trades you have to play all.

Every event is independent of the previous one. If your last 2 trades are loser doesn’t mean next will also be a loser, because markets are random and you can make consistent result if you have odds in your favor.

Comment:

Discipline is important than skill.