Entry price is the thing everybody argues about. Position size is the thing that decides whether being wrong matters, and it is entirely within your control.

Most discussion of trading is about direction. Direction is the part nobody can reliably predict. Size is the part fully under your control, and it decides what a wrong answer costs — which, over a series of trades, matters more than the accuracy of any single answer.

Losses and gains are not symmetrical

This is arithmetic and it surprises people every time, because percentages are calculated on what remains.

Slide the picture sideways →

Lose half and you need to double what is left to get back — not gain fifty per cent. Lose ninety and you need a tenfold return simply to be where you started. The curve does not rise gently; it bends away from you, and past a certain point recovery stops being a plan and becomes a hope.

Sizing from the stop, not from the feeling

The usual approach reverses how people naturally think. Instead of deciding how much to buy and then wondering where to exit, you decide what a loss may cost and let that determine the size.

1. Fix what one loss may costStated as a share of the account, decided before you look at any chart. Whatever number you choose, the point is that it is a rule, not a reaction to how attractive a particular trade looks.
2. Decide where the idea is wrongA price at which the reason for the trade no longer holds. This has to come from the situation, not from what you can afford to lose — a stop placed where it is convenient is not a stop.
3. DividePosition size = the amount you are willing to lose, divided by the distance to the stop as a fraction. Risking 100 with a stop five per cent away gives a position of 2,000. A tighter stop allows a larger position for the same risk; a wider one demands a smaller position.
4. Do not adjust for confidenceSizing up on the ones that feel certain is how a controlled series of losses turns into a single uncontrolled one. Feeling certain is not information.

Notice what this does: the size becomes an output, calculated, rather than a decision made while looking at a chart that has already made you feel something.

Win rate and reward, which mean nothing separately

A high proportion of winners says nothing on its own — it is trivially achievable by taking tiny profits and holding losses. A large reward per winner says nothing either, if winners are rare enough.

Only the combination matters, together with the cost of trading. Sixty per cent losers is entirely workable if the winners are large enough to cover them. Eighty per cent winners can still lose money if the losses are big. Anybody quoting one number without the other is not telling you anything.

Losing streaks are normal, not evidence

Even where the underlying odds are favourable, runs of five or six consecutive losses appear routinely across a hundred trades. That is how independent outcomes behave, and it is not a signal that something has stopped working.

The practical consequence is the point: a series of losses must be survivable both financially and personally, because it will happen. Sizing that only works when the sequence is kind is not sizing.