The first reason most people fail to build a trading system is result-oriented thinking in individual trades.

It’s hard not to be swept up in the mindset of “win or lose right now,” letting emotions go haywire.

Think of it like a wagering game—for instance, rolling dice. The game isn’t that complicated. You have 1 million, and under no circumstances should you bet the entire 1 million.

Even if the probability is 100%, you still can’t do it. That’s the rule. Don’t ask why. The proportion of your stake must always be less than the probability. That’s a given. How much smaller depends on the specifics of each case.

For example, 800,000 is 80% of your 1 million total capital. Say the win rate is 99%. Since 80 < 99, it’s fine. Or consider 160,000, which is 80% of your 200,000 total capital, with a 99% win rate. Again, 80 < 99, so it’s fine. Suppose you bet 800,000. There’s a 99% chance it doubles, and a 1% chance you lose everything. What’s the expected value? It’s 1.6 million × 99% − 800,000 × 1% = 1,576,000. Is it worth trading 800,000 for an expected 1.576 million? Absolutely. No problem there. But that expected value doesn’t guarantee your 800,000 will become 1.576 million. Say in the first round you’re just unlucky and get wiped out. Then in the second round, you bet 160,000 with a 99% chance to double and a 1% chance to lose everything. What’s the expected value? It’s 320,000 × 99% − 160,000 × 1% = 315,200. Is it worth trading 160,000 for an expected 315,200? Again, very much so. But once more, if you’re unlucky, your 160,000 disappears too. Does that affect your decision in the third round? It shouldn’t. From 40,000, you can still put in 32,000 and keep going. But most people can’t manage this. Someone who earns any amount of money still can’t smile—what does that mean? It means they’ve lost their capacity to feel; money can’t bring them any happiness. Someone who loses any amount of money and never cries—what does that mean? It likely means they’re already a high earner. They simply don’t need that money. People who don’t need money make it far more easily than those who do. The more you crave something, the less likely it is to come to you. The less you need it, the more abundance flows your way. This is the Way of Heaven: it diminishes the insufficient to enrich the already abundant.