DVDs I Recommend:
The reason I think most traders have a 25%ish win rate.
In a sense of probabilities, 50% the stock goes "Up" 50% does "Down", right?
So you might say that you should have a 50% win rate on average.
Incorrect, since the graph of a stock, is also a representation of time, you need to assign a variable to time as well.
We'll call it "Right Time", "Wrong Time".
Right time 50% = 25% (75% /25%)
Up 50% X
Wrong Time 50% = 25% (25% /75%)
Right time 50% = 25% (75% /25%)
Down 50% X
Wrong Time 50% = 25% (25% /75%)
You might notice that the gurus normally have 60-75% win rates.
Which is logical from a statistical standpoint.
In essence, you could say that gurus with a 75% win rate have mastered direction and time in the market, and I think that's neat.
On another note, in the event someone has a higher win rate than that, you can assume they are probably misleading you. Or at the very least they don't have enough of a sample size to extrapolate accurate performance information.
Thumbs up if you a nerd too. :p
If you're interested in learning more about trading pyschology, I'd highly recommend the book "Trading in the Zone." It was recommmend to me by someone here a while ago. I got the audible version. The reader isn't the best, but it does a really good job of explaining trading pyschology.
Mr. Owens recommended that book as well. It's on my list. I just finished Hedge Fund, Market Wizards for like the 3rd time. lol
Never heard of that one. 3 times must mean it's good, though. I'll check it out. Thanks!
I just bought it thanks.
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