Markets are efficient and prices are right, so most traders lose. The only edge is expected value: win rate times reward minus loss probability times risk. That math should drive every trade you make.
Markets are extremely efficient. Markets are extremely hard to beat. And most hedge fund managers underperform and most traders fail. And my base assumption for almost anything is that the starting price that we see stocks or any product trade at is the right price. And with that assumption in mind, you then need to ask oneself what might lead to a situation where we're out of equilibrium. And so any time in trading, the concept that drives every single decision you need to make is expected value. Expected value is is your win rate times your reward if you win minus the odds of losing times what you risk if you lose.
