Identify the Streaks Your Profile Will Generate

Below is a list of each natural trading style and the winning/losing streaks that style will likely experience over a large number of trades. See how Win Big trading styles endure more losing streaks and potentially higher drawdown rates compared to the Win Frequent styles. What this chart doesn’t show is the profit potential of each style. In later lessons we’ll get into profit potential and it may surprise you. The data in this table shows the mathematical probabilities over the course of 200 trades.

Understanding these natural trading styles; their base winning percentage, and expected winning/losing streaks, helps you better understand how to manage your risk, results, and expectations as you begin to trade.

As you look over these values, ask yourself which style would you feel most comfortable trading. Think about the trade-offs that come with each style. Win Big styles give you the chance to have large profits on a trade but the trade-off is that you’ll experience a higher number of smaller losses. On the other hand, the Win Frequent styles give you a chance to win on a higher number of your trades but the trade-off is your profit per trade is much smaller.