How can low win-rate trading still make big money?

Have you ever fantasized about the myth of "winning every time" in trading? Many people believe that a high win rate equals success, thinking that making a profit on every trade is the way to make money. But in reality, true experts often do not pursue a 100% win rate. Low win rates and high risk-reward ratios are the keys to their profitability. Today, let's talk about this seemingly contradictory truth: why can low win rates still lead to large profits?

Many novice traders always want to "win every time," but the market is not that simple. Pursuing a high win rate may actually lead you into a dead end. This is because trades with high win rates often earn very little but can incur large losses. Once the market fluctuates violently, even if you made a profit nine times before, one loss could wipe out your account.

Look at the top traders on Wall Street; their win rates are usually only 35%-50%. It sounds low, but they make big money. The key lies in their trading philosophy: successful trading is not about winning every time but about making big money at the right time and cutting losses quickly when losing, thus controlling risk. Even with a low win rate, they can achieve stable profits in the long run.

Their trading logic is very simple: when the market is favorable, they increase their position size and make big money; once the market reverses, they immediately cut losses to reduce their losses. Through this method, they can ensure that their risk-reward ratio is much higher than their win rate.

The key to successful trading is actually the risk-reward ratio. For example, there is a trader with a 40% win rate in 2023, but each time they make a profit is ten times the amount they lose, resulting in a threefold increase in their account's net worth. Meanwhile, another trader with a win rate as high as 90% lost everything in one black swan event, erasing all their profits.

Therefore, true success does not lie in pursuing a "100% win rate" but in learning to manage the risk-reward ratio. Boldly increase your position size when correctly judging the market, and cut losses promptly when losing; this is the secret to making big money.

Every failure is experience, and every success can magnify profits. Do not obsess over a high win rate; instead, build your own risk-reward strategy. Learn to find balance in trading, and you can steadily progress in this market and gradually achieve financial freedom.