Issue 1 · Tuesday, October 20, 2026 · 4-minute read
Welcome to the first issue of LuckOrEdge. I taught high school biology and chemistry for ten years, and I've spent the last five building automated trading strategies. This newsletter brings those two worlds together.
Every Tuesday, you'll get a quick quiz, one trading idea tested the way a scientist would test it, and one term explained in plain language. Every test ends with something you can apply to your own trading.
WEEKLY QUIZ · BEGINNER
Every week brings one question, rated Beginner, Intermediate or Hard. This one is a warm-up: read this week's test below, then come back and vote. The answer arrives next Tuesday.
A trader wins 6 of their first 10 trades. What can they conclude?
LUCK OR EDGE? · THE WEEKLY TEST
Why 50 trades prove less than you think
You've taken 50 trades and won 30 of them. A 60% win rate. It feels like you've found something. Before you size up, let's ask the question this newsletter is named after: luck or edge?
Here's the test. Picture 10,000 traders with zero skill, each flipping a coin to decide 50 trades, where every win and every loss is the same size. How many end up with a win rate of 60% or better?
One assumption to keep in mind
Every example in this issue uses a 1:1 risk-to-reward: each win is the same size as each loss. Real strategies rarely work that way, and risk-to-reward changes the picture in important ways. It gets its own issue soon.
The answer: about 1,000 of them
Pure chance gives 1,013 of the 10,000 a win rate of 60% or more. That's one in ten. If you met any of them, their record would look exactly like yours.
Win rates of 10,000 coin-flip traders after 50 trades. The amber bars, 60% or higher, hold about one in ten of them.
The good news is that luck runs out. The more trades you take, the harder it becomes for chance to fake a good record. Randomness evens out, but slowly: to cut the noise in half, you need four times as many trades.
The chance that a coin flip shows a win rate of 60% or more, by number of trades.
At 50 trades, chance matches a 60% record 10% of the time. At 100 trades, 2.8%. At 200 trades, just 0.3%. The same win rate means something completely different depending on how many trades stand behind it.
APPLY IT THIS WEEK
Measure your noise band. Divide 1 by the square root of your number of trades. At 50 trades that's about 14%, so with a 1:1 risk-to-reward, any win rate between 36% and 64% is within normal luck. At 200 trades, the band shrinks to about 7%.
Check your payoff, not just your win rate. Multiply your win rate by your average win, then subtract your loss rate times your average loss. A 60% win rate where losses are twice the size of wins still loses 0.2 of your risk on every trade.
Don't change your rules mid-count. Every rule change starts a new sample. Keep a log and judge each version only on its own trades.
TERM OF THE WEEK
P-value
If your strategy had no edge at all, how likely is a result at least as good as yours, by luck alone? That's the p-value. Thirty wins in 50 trades has a p-value of about 0.10: luck does it 1 time in 10. Scientists usually want 0.05 or lower before taking a result seriously, and lower still when many ideas have been tested. What a p-value isn't: the chance that your strategy works.
NEXT WEEK
The 3 Bar Play, put to the test
It's one of the most popular day-trading setups, popularized by Jared Wesley of Live Traders. We'll test it exactly as it's taught and see what the evidence says: luck or edge? Plus, the answer to this week's quiz.
Your turn
Hit reply and tell me what you trade and which strategy or trading rule you'd like to see tested. I read every reply, and your suggestions shape future issues.
LuckOrEdge is educational content only, not investment advice. The examples assume a 1:1 risk-to-reward; real results depend on your strategy, costs and trading. Past performance does not guarantee future results.