The 60/40 Trap.
You have a sixty-percent winning edge in a one-to-one payoff game. Most professional traders would call those odds a gift. So why does almost everyone who plays this game go broke?
The setup
One hundred trials. Each trial, you choose a bet — any fraction of your current equity. A coin lands: 60% it pays you 1× the bet, 40% it costs you 1× the bet. That's it. No fees, no slippage, no news.
This is a better game than anything on offer at a casino, and it is meaningfully better than the average trading strategy. The expected value of the next trial, at any non-zero bet, is positive. The optimal sizing — what mathematicians call the Kelly fraction — is exactly twenty percent of your current equity, every time.
Bet too little and you under-use the edge. Bet too much and ruin is a near certainty. The interesting part is the too much: most people, given this game, lose money.
The rules
- Start with ₹10,000.
- Choose a position size — any number of rupees up to your current equity, or any percent of it.
- The coin decides. 60% you win the bet, 40% you lose it.
- Repeat for 100 trials, or until you go broke.
What overbetting looks like
Your turn
Below, you get to play. Choose any sizing strategy you like — fixed percent, gut-feel, martingale, anything. When you're done (or broke), the results page will replay the same hundred coin flips at the Kelly 20% size, side by side with yours. The difference is sizing, not luck.