I’m by no means a Nadex, day trading, binaries, etc. expert. In fact, I just made my first trade this week. The one thing that I just don’t understand is the profit/loss “profit management” system when you have a known overall win probability of 70-75 percent. I understand that each next trade is a virtual coin flip, but what I don’t get is why cut a day early based on reaching a profit/loss of 2, 3, 4, or 5 percent? As long as you had proper risk management, you should be able to trade for 1 hour or 24 hours in a row and not have to worry about pocketing wins or cutting losses for a day.
If we were in the casino I could totally agree with you on this; mainly because the overall win/loss probability is in favor of the casino. So implementing a profit management system in the casino scenario makes sense both intellectually and mathematically. So even though we as the gambler may have massive losing or winning streaks in any one session, the casino wants us to play as long and as often as humanly possible…because the win probability getsvin their favor faster.
So in day trading, we are now the “house” and the odds (win probability) are in our favor. And technically speaking, as long as our mental focus and bankroll management was spot on (meaning we maintained proper bet sizing to avoid risk of ruin), the longer we traded and the more often we traded would only allow us to reach our actual win probability of 70-75 percent that much faster.
Am I right, or am I just missing something here? (Awesome site and great service by the way)!