How to Tell Luck From a Real Edge

The five questions

Five questions tell a lucky result from a real edge. How many trades: luck is a week or a month, an edge is hundreds, over more than one kind of market. Was it written down first: luck is found by looking, an edge was written before the bars were seen. New bars: luck fades out of sample, an edge holds there, smaller. The wobble: luck's average sits inside its own wobble, an edge's sits several wobbles from zero. The costs: the spread eats luck, an edge survives the spread and the slippage. An edge is a small average that holds everywhere; luck is a large result that happened somewhere. The plain 10:00 to 18:00 rule on the euro, on the evidence of 135 trades in 2026, is the second kind so far, and the rest of this paper shows why.

A lottery ticket and a till receipt

Picture a lottery ticket and a till receipt. The ticket paid one big number, once; the receipt is a small number on every line, all day, every day. Both can show the same total at the end of a month, and only one of them will show it again the next month, because the receipt's total came from the shape of the business and the ticket's came from the draw. A rule whose result is mostly one week is a ticket; a rule whose result is a little on most weeks, and still there after costs, is a receipt. The question is never how big the total is but which of the two it looks like.

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