This is the story of Hottie Miss Martingale.
She is a seductress that lures you in with ease.
- She will excite you far beyond the normal
- Your heart will thump
- You will sweat
- You will jump up and down for joy.
- She will keep you awake at night with the excitement of a better life.
- She seems to be the hottest piece of awesome you have ever seen and she promises you the world.
Life is Great! ... for now 😈
Hottie Miss Martingale makes you happy every single time you use her. She seems to do everything in your favor. However, She is also a deceiver. She will lure you in with her false promises and then right when she has you where she wants you…
First, It's like this...
You are making profits hand over fist. They keep coming! Nothing can stop you! You have fallen victim to this devil.
Bam!!!
She will slice your account to shreds!
She will make you worry.
You may cry alone at night.
You will get so depressed that you will do anything to fix this horrible mess you have created.
Hottie Miss Martingale is a liar and a thief.
Hottie Miss Maringale has this name for a reason. Do you know what martingale means?
The following paragraph was copied from Wikepedia but says exactly what martingale is.
Martingale refers to a gambling strategy. The gambler wins his stake if a coin comes up heads and loses it if the coin comes up tails. The strategy has the gambler double his bet after every loss so that the first win would recover all previous losses plus win a profit equal to the original stake.
As the gambler's wealth and available time jointly approach infinity, his probability of eventually flipping heads approaches 1, which makes the martingale betting strategy seem like a sure thing.
However, the exponential growth of the bets eventually bankrupts its users, assuming the obvious and realistic finite bankrolls (one of the reasons casinos, though normatively enjoying a mathematical edge in the games offered to their patrons, impose betting limits). Stopped Brownian motion, which is a martingale process, can be used to model the trajectory of such games.
In other words...
A Trader bets $1. If he wins, it's all good. If he loses...
He bets $2. If he wins, it's all good. If he loses...
He bets $4. If he wins, it's all good. If he loses...
He bets $ 8. If he wins, it's all good. If he loses...
He bets $16. If he wins, it's all good. If he loses...
He bets $32. If he wins, it's all good. If he loses...
If he loses on bet # 5, then he is not only down by $32. He is actually down by 32+16+8+4+2+1 = $63! f he wins, he wins $1
What happens if he wins on Attempt #10?
If he wins, he wins $1
If he loses, he is down by a whopping $2,047
After loss #20, he is now down by $524,287!
What if your account is not that high? You are f***ed!
If you are a martingale trader, and I can not convince you otherwise, then at the end of this article, I will show you how to do it without blowing out your account as fast.
This is adult content because you have to be an adult to swallow it. If you do not believe that you will take 20 losses in a row (If you do't stop), you WILL. The law of averages will eventually catch up to you. Do you think that over the course of millions and even trillions of possible trading entries that there is not 20 losses in a row?
I ASSURE YOU there will be strings of losers.
The Lure
The thing that makes martingale attractive, especially in trading is that it has an extremely high win rate.
It can turn losers into winners 99% of the time. How would you like a 99% win rate. This is the lure to newbies. They keep adding as they are losing and one day they go bankrupt. They all do. Take a look at the following probability picture.
Source: https://wizardofodds.com/gambling/betting-systems/
Imagine you are trying to make $1.
Are you willing to risk it all on this one trade? Are you willing to risk over $2,000 or more trying to make a measly $1?
Welcome to martingale! It sounds so absurd that no one would try it but we do. We all do so don’t feel bad.
###I have used it and it blew out 9 flipping accounts every single time!
It’s not a matter if IF, it’s just a matter of WHEN.
What if you have used this method for years and built up $100,000,000 and then in one day, you lose it all and even end up owing people? This is exactly what happened to a company called ‘Long Term Capital Management’. They martingaled their way from zero to $4.6 billion in a few years and then lost it all in less than four months!
Here is a screenshot over the course of thousands of trades. Take a look and imagine if...
you had 7,500 trades under your belt, without a loss and then one day you lost it all!
This is what happened to LTCM.
YOU HAVE BEEN WARNED! NO MATTER HOW MUCH YOU ARE TEMPTED, DON’T GIVE IN TO THIS EVIL TEMPTRESS!
How to 'Martingale' without losing your entire account in one day.
- Step 1 - Limit it to 4 attempts.
- Step 2 - The End.
On attempt #1, if you win, you win $1. If you lose, you are down by -$1
On attempt #1, if you win, you win $1. If you lose, you are down by -$2
On attempt #1, if you win, you win $1. If you lose, you are down by -$4
On attempt #1, if you win, you win $1. If you lose, you are down by -$8
If you have not won by attempt #4, stop and take your tiny -$15 loss and stop trading. COme back tomorrow and try again. Losing $15 is manageable but losing $500,000 is not!
