Martingale

Martingale is a position-sizing system that doubles your bet after every loss. The idea is that eventually you'll win, and the win will recover all prior losses plus the original profit target. On paper it sounds bulletproof. In reality it destroys accounts because losing streaks happen, and exponentially increasing size eventually exceeds your account. The math: if you risk $100 and lose, then $200 and lose, then $400, $800, $1600... after just 7 losses in a row you need to risk $12,800. Most retail accounts can't survive a 7-loss streak in any normal strategy. A 10-loss streak (which happens regularly) needs over $100,000 to recover. Martingale gives traders a false sense of security because most martingale runs WORK for a while. The system has a high success rate per cycle — but every time it fails, the failure is total. The expected value over many cycles is negative.