Biological Traps in Trading: Why Small Wins Are More Reliable Than 100x?

Author: VKTR

Compiled by: Luffy, Foresight News

I recently started actively trading perpetual options again after a long break. It got me thinking back to when I first started trading in 2018. Back then, some of my favorite traders shared some knowledge that forever changed the way I looked at the markets. I'm not great at writing, but I'm always grateful to those who came before me and want to pass on that knowledge. So here I go.

There is a truth that I still remember to this day: the biological mechanism of winning is engraved in the genes of almost all organisms.

When two lobsters fight, the winner's hormones will soar. He will be full of serotonin and testosterone, and he will hold his head high like a "lobster macho man", while the loser will curl up, sulk, and enter the self-soothing mode of "beta lobster".

This isn't just some random nature documentary bullshit. Jordan Peterson is slightly schizophrenic, but he's got it basically right. He's talking about this for a reason. Winning literally rewires your brain, changes your posture, inflates your confidence, and sees opportunities instead of threats. It's millions of years of evolutionary programming, and your brain doesn't care if you're fighting for territory or competing in the marketplace.

This is exactly the logic of the transaction.

Every small profit should excite you. Every winning trade should sharpen you up and make you more ready to win again. But in my experience, most new traders do the exact opposite.

They chase "quick wins" instead of accumulating boring gains; they show off screenshots instead of making actual profits; they bear 80% retracements and call it "belief"; they make revenge trades after losses instead of thinking calmly; they compare their meager 2% unrealized profits and losses with the 10x insider trading of some KOLs.

The real winners are quietly accumulating boring gains and letting time do the repetitive work.

Why Your Brain Wants You to Be Broke

When you fail, your serotonin plummets, your shoulders slump, and you see danger everywhere. Your risk assessment completely fails because your brain thinks you are now at the bottom of the dominance hierarchy.

So what do broke traders do? They try to win back all their losses in one trade. They add to their positions, chasing the next shitcoin with a market cap of less than $60k. They listen to a signal from a former Fortnite scammer on Telegram.

Good traders do the exact opposite. They take their losses, maybe spend five minutes figuring out what went wrong, and then move on. They know that one down day out of twenty up days is just noise. They protect their own psychology more than they protect their portfolio.

I see this all the time. Someone loses a lot of money and immediately uses 20% of their capital to go all in on a bunch of shit coins. It's like watching someone hit themselves in the face over and over again without knowing why their nose hurts.

Compound interest is always underestimated

Most people can’t understand compounding because it’s slow and boring to start with. $50 on a $10,000 account makes you think “what’s the point”. But that’s exactly why it works: boredom makes money, excitement comes at a high price.

Einstein called compound interest the "eighth wonder of the world." Just imagine that the man who proposed the theory of relativity had such high regard for basic mathematics.

You don't need to win big every day, that's not how the market works. Sometimes you make 1%, sometimes you make nothing, and sometimes you lose a little. The point is that over time, your net gains will be greater than your net losses.

Take @gametheorizing, for example. I remember reading in @thiccyth0t's blog that he keeps his net worth about 2x per year and does nothing else. He makes sure he doesn't overdo it or hit a "peak." People who make 100x usually can't keep their money, just like lottery and casino winners, they don't know how to manage their wealth.

What is an effective strategy?

Take profits early and stop thinking about diamond hands. The market doesn't care about your beliefs, it cares about supply and demand. When you make a profit, you must stop profiting, at least a little at a time.

Keep track of your wins. Take screenshots of every win and create a folder to look at when you're having a bad day. Your brain needs proof that you're a winner, not just an abstract recollection of the moment you made money. Posting realized P&Ls is fine, but posting unrealized P&Ls is usually a bad idea, just ask any seasoned trader.

Control your leverage. Start with 1x or 2x. Increase leverage only after you have proven that you can make money without leverage. Leverage amplifies everything - including your stupidity.

Set daily goals, but be realistic. Don't trade for the sake of trading. Trade to reach your goals and then exit. Get out and get in touch with nature. The market will be there tomorrow and may look completely different.

Track your win rate. Keep a simple spreadsheet or use a P&L page like @CoinMarketMan, @tradestream_xyz or @AxiomExchange. If your win rate is less than 60%, there is something wrong with your strategy, fix it now.

Establish a ritual. Same setup, same time, same process. Your brain loves patterns. Create a pre-trading ritual that puts you in winning mode. It could be drinking coffee, reviewing your rules, or doing push-ups.

The hardest part of small wins

Most people make the mistake of trying to accumulate small wins: you have to make sure your losses are small. Small wins mean you have to keep your losses small, too.

I struggled with this at first. My equity curve looked like a Thanksgiving turkey chart - a small uptick followed by a huge black candle that wiped out weeks of gains. This is probably the hardest part of the entire strategy, but it is non-negotiable. A strategy of small wins and big losses will only slowly destroy your account.

Losers do this: They blame others for market manipulation. They switch strategies every week. They join Discord servers looking for “alpha.” They become addicted to gambling instead of treating it as a business.

Winners do this: They take their losses, learn from them, and prepare for tomorrow. They understand that trading is a marathon, not a sprint. They know that perseverance is more important than thrills.

One defeat among dozens of wins will hardly have any impact on the outcome.

The real way to success

While everyone else is betting on the next L1 of Dogecoin, you might be building a strategy that actually works. While they’re staring at open positions all day, you might be working on your goals and then going to the gym.

The real advantage lies not in some secret trading strategy, but in self-discipline. In treating trading as a business, not a casino. In understanding that the goal is not to be right, but to be profitable.

Most traders trade to be right, while winners trade to make money. There is a huge difference between the two.

Getting rich slowly is boring and not cool. Your shitty posts won’t go viral because of steady profits. But you know what’s even more boring? But even less cool: being poor at 30 because you spent your 20s chasing a 100x “belief position” that never came.

Most people who post pictures of their Lamborghinis on social media are poor. They rely on a "moon landing" to show off on social media, and then lose everything they put in.

Of course there are many exceptions, but in most cases the real winners are those you can't see.

Just win

Small wins build momentum, and momentum puts you in a flow state. Lock in profits, build confidence, and become the lobster that controls the rock.

Stop trying to prove you're smart and start proving you're disciplined. Win or be broke.