Martingale

Martingale is an extremely popular trading system based on increasing positions after loss-making trades and lessening them after having profit-making trades. The strategy is based on a well-known psychological delusion which says that the probability of making a profit increases after making a loss. Martingale can be associated with high risk trading systems, although when used correctly it can yield profits which more than counterbalance even high loss-making trades. There are two types of Martingale: the simplified (when the trading position doubles after each loss) and the complicated which demands ultimate mastery and self-control from the trader since they should assess their trades as part of those within a series which only ends when profits exceed losses.