- The amount of relevant accurate information needed for a good decision is inversely proportional to the power of the edge needed. If the edge is small, then more accurate relevant information is needed. If the edge is great, then less relevant accurate information is required.
- The smaller the time frame of the decision, the more of an effect smaller time frame information will have on the outcome, making it harder gather to gather all relevant and accurate information, requiring a larger edge for a successful decision.
- Thus on smaller time frames, it’s impossible to make a good decision without a good edge.
- An edge’s power is subjective and it is hard to find an objectively good edge.
- Thus expect the decisions on lower time frames to fail, due to not enough relevant accurate information and a weak edge.
- So, extreme care must be taken to mitigate the risk of each of these decisions, and limit the loss from the expected failure.
- Since the decisions on lower time frames are expected to fail, expected success rate from just one decision is near zero.
- The expected success rate will only rise after many decisions, each made with mitigated risk and an edge.