The gap between knowing the math and being able to sit in it
You have calculated expectancy. It is positive. You understand that losses are the cost of the edge.
Then you lose six in a row, and every instinct says the system is broken. The knowledge does not transfer automatically into the ability to sit still. That transfer is what this lesson is about.
Know your losing streaks before you meet them
The probability of a run of *n* consecutive losses is roughly (loss rate)^n. Over a series of trades, such runs are not merely possible — they are expected.
For a 40% win-rate system (loss rate 0.6):
| Streak | Chance in any 100 trades |
|---|---|
| 4 losses | Near certain |
| 6 losses | About 70% |
| 8 losses | About 30% |
| 10 losses | About 10% |
A 40% system that never lost eight in a row would be the anomaly. When it happens, the correct interpretation is "as forecast," not "something has changed."