How do you admit you were wrong, in trading and to yourself?
Being wrong is the default state in trading — most trades could fail, most forecasts miss. Yet admitting it remains one of the hardest psychological skills.
What's your process?
- how you notice you're defending a losing position
- what makes the admission easier
- how being wrong became less painful over time
The expectancy guide makes being wrong statistically normal.
Background: Risk-reward ratio, win rate and expectancy: the maths behind a trading edge
A high win rate can still lose money. See how win rate and risk-reward combine into expectancy, with break-even win rates and worked examples.
What is a good risk-reward ratio in forex?
There isn't one right ratio. What matters is expectancy, the win rate and ratio together. A 1:2 ratio breaks even at about 33% winners before costs, while a 1:1 ratio needs 50%.
How do you calculate trading expectancy?
Multiply the win rate by the average win and subtract the loss rate multiplied by the average loss. Measuring wins and losses in multiples of the amount risked (R) makes the result easy to compare.
Comments
Log in to join the discussion. Comments follow the community guidelines.
Log in to commentLoading comments…