Win rate

Win rate is the fraction of trades that make money. It is the most quoted and most misleading statistic in trading. A 90% win rate strategy can lose money if the rare losses are huge; a 40% win rate strategy can be excellent if winners dwarf losers.

Win rate only becomes meaningful next to average win size versus average loss size, and trade count. A 67% win rate across two thousand trades with capped losses describes a real edge; the same figure across thirty trades describes luck.

Treat any strategy advertising win rate alone, especially above 80%, as a red flag: that shape usually means small steady wins against occasional catastrophic losses.