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#51 – Trading Tip of the Week

By On December 17, 2012 - 10:00 AM · Leave a Comment · In howtotrade.pricegroup.com

The odds of long-term success favor a larger account. Large accounts can withstand a run of bad trades that would ruin a smaller trader’s account. Imagine a series of coin tosses. In the long-run, half of the time the coin will lands on heads and half of the time the coin will land on tails. The longer the coin is tossed, the closer the average comes to 50/50. In the short-term, however, the average can be skewed. For example, in 30 tosses there is a higher likelihood that the coin could land on heads ten times in a row. This is a very simplistic view of trading but imagine if heads represents a winning trade and tails represents a loser.

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