The trading record of each high-performance strategy showed numerous small losses intermixed with a variety of gains, some small and some large. The small gains and small losses tended to cancel each other. What remained were the larger gains. There were no large losses in the loss column to cancel them. We found something else that was at first a bit confusing. Sometimes the losses far outnumbered the gains. Our immediate question was, "how can we have more losses than gains in a top-performing strategy?" The answer was, of course, that the losses were tiny in comparison with some of the gains.

Whether an individual is or is not an expert trader can be determined easily by looking at the size of his or her losses. An expert's losses will all be small. An expert trader may actually have more losing than winning trades. There is nothing wrong with that. However, the fewer larger gains will more often than not outweigh the larger number of small losses.