Rules First · Lesson 7 of 9 · Free sample

What your record proves, and what it doesn’t

A 60% win rate feels like proof. On 20 trades, it isn’t. This lesson is about the gap between what your record shows and what it proves.

This is a sample from the paid course. Lessons 4 to 9 are in the full course. This one is free so you can see the depth before you buy.

The range is the real answer

Your win rate on a small sample is a rough guess at your true win rate. The honest way to report it is as a range.

Example: a setup with a 60% win rate, $300 average win and $250 average loss. Its break-even win rate (Lesson 2) is 45.5%. Here is where its true win rate is likely to be:

20 trades, 12 winners: 60% likely between 38.7% and 78.1% 40 trades, 24 winners: 60% likely between 44.6% and 73.7% 100 trades, 60 winners: 60% likely between 50.2% and 69.1%

Same 60% every time. Only the number of trades changed.

  • At 20 trades, the bottom of the range (38.7%) is below break-even. The record hasn’t ruled out a losing setup yet.
  • At 40 trades, it’s still just below (44.6%).
  • At 100 trades, the bottom (50.2%) clears break-even. Now the record supports “this makes money on average”, for this sample, under these rules.

Your setup might make money at 20 trades. You just can’t say it does yet.

Proving it works vs deciding to stop

These aren’t the same bar, and that’s fine.

  • To say a setup works, you need the bottom of the range above break-even. That usually takes many trades.
  • To stop risking money on it, you only need the line you wrote in Lesson 4 to be hit. “After 20 trades, if the average result per trade is below zero, it goes back to demo.” You’re not proving it’s broken. You’re deciding, in advance, when the evidence is bad enough to stop paying for it.

Check your Lesson 4 line now. Has it been hit? If yes, do what it says. If you want to argue with it, that’s exactly the moment it was written for.

Only trades under the same rules count

If you changed the setup’s rules at trade 15, trades 1–14 and 15 onward are two different samples. Don’t add them together. This is why Lesson 9 changes one thing at a time.

What your record can’t tell you

  • Whether your rules are good. It reads results, not decisions.
  • The future. Even a record that clears break-even describes the past.
  • Anything, if trades are missing. Leave out the bad ones and the numbers are fiction.

Your turn

  1. Put your trades, winners, average win and average loss into What your trades actually prove. The Review tab in the Journal shows the bottom of the same range (“Your real win rate is likely at least”), worked out from your log.
  2. Write down your range, your break-even win rate, and whether the bottom of the range clears it.
  3. Check the By setup tab. A record that makes money overall is often one setup carrying the others.
  4. Check your Lesson 4 line for each setup.
Done when: you know your win-rate range, not just one number, and you’ve checked each setup against the line you wrote in Lesson 4.

Next in the full course: Lesson 8, getting paid.

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Educational material only. Not investment advice. Trading futures involves substantial risk of loss and most people who try it lose money. Check your account rules with your firm; they change.

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