> ## Documentation Index
> Fetch the complete documentation index at: https://www.questforedge.io/llms.txt
> Use this file to discover all available pages before exploring further.

# How Losing Streaks Actually Behave

> Why losing streaks occur even in profitable systems and how their impact depends on position size.

# How Losing Streaks Actually Behave

A profitable trading system can still produce long sequences of losses. A win rate describes the long-run proportion of winning trades; it does not determine the order in which wins and losses arrive.

For a system with win probability **p**, the probability that one specified block of **n** trades consists entirely of losses is **(1 − p)^n**.

The practical implication is simple: position size should be chosen for adverse sequences, not only for average results.

A system can have positive expectancy and still become untradeable if its normal variance produces a drawdown the trader or account cannot tolerate.