POLL: win rate, reward:risk ratio

[ETcallhome]

That's a simplistic hypothesis.

I think that high win rate strategies,
Are more specific than high R:R ones.
They have lots of assumptions, parameters.
Kinda more complexe and conditions dependent.
Therefore more prone to perish as the edge vanish.

Whereas high R:R strategies are more dumb.
At least, it's not the same kind of intelligence.
They are more about method rather than setups.
Also more robust and portable than specific strategies.

Taleb could sums it up this way:
At one side the Smart and Fragile
At the other side the dumb but antifragile.

I wonder if it's a trade off.
Or if Smart can be Antifragile.
But from my experience dumb can be fragile.
So I'd be tempted to say that smart can be antifragile.

if you are making money being dumb and anti fragile, you really don't need to be smart. All being smart will do is make you more fragile.

 

[K-Pia]

Contrary to common sense.
I believe that a low Reward to Risk is Riskier.
People tend to pick pennies in front of steamroller.
They think it will give them a chance to succeed where,
You actually have 50% chance of going broke with a 1:1
33% with a 2:1, 25% with a 3:1, 20% with a 4:1 ... Etc ...

Because you need to be inversely good to succeed.
We can control R:R but not how good we are.

Therefore a 4:1 gives you more room for error.
You only need a P(G)>0,25 with a 4:1.
But P(G)>0,5 with a 1:1 ...