How successful is Martingale strategy in systematic prediction markets trading

To clock success in prediction markets trading, you need more than mere luck. You have to figure out the right approach and learn the strategies you could use to enhance your probability of success. When you want to make money consistently from the prediction markets, you have to do it in a sustained manner.

While there are several prediction market trading strategies, the Martingale strategy is the most renowned among these. Let us find out what this strategy is all about and how it increases the chances of your success.

How successful is Martingale strategy?

Origin

A popular strategy among traders, Martingale is supposed to have originated from 18th century France. What made it one of the most used strategies is the simplicity of approach — Doubling the bet after losing the previous bet, hoping to win this time. The strategy recommends doubling of the bet with the objective to cover the previously lost bet.

Originally, Martingale strategy has come out of 18th century France, along with several other strategies, all of which were related to gambling and gaming, particularly for zero-sum games, when each side bet the same amount. In such games, wins and losses are absolute. In other words, whichever party wins takes it all. Similarly, the losing party too faces a total crash.

Applying the strategy to roulette

Today, players would generally apply Martingale strategy to roulette as it has just half the probability of hitting either red or black. The size of account is the only limiting factor in Martingale strategy as you have 50% chance of receiving all the money if you make the next trade.

Applying Martingale strategy terminates the need to conduct technical analysis before trading. What counts is the outcome of the next trade. You should be able to complete a trade and, in case you lose, double the stake.

With each consecutive trade, your chances to produce a win enhance statistically, provided you have deep enough pockets. You should be clear about this aspect before going ahead. Assumptions you make must be based on hard facts.

Martingale is more than luck

Contrary to what many think, Martingale's strategy is not just about luck. If you don’t know how to use it with efficiency, the losses may quickly compound. You need to be aware of money management techniques such as the Percent Rule to ensure no single trade is big enough to wipe your money.

At the back of your mind, you need to recognize there is more to Martingale than mere luck. You should know what you are doing before staking your greenbacks. This is important you have to increase your stake, knowing that you have to cover your previous loss. It is imperative for you to garner a profit equal to the initial trade, else you will use your money.

An example

In case you place a trade for $200 and unfortunately lose it, then you make a trade for $400 and win 85%, what you get is $740. It does cover your costs ($400 + $200) but not winning all of the first trade. You need to be aware of this crucial factor before applying Martingale strategy at every trade. As it is evident, successful implementation of the strategy requires a blend of patience and courage.

Closing thoughts

Martingale strategy could get you the dividends, provided you know what you are doing. Do your math properly and develop a method in your application; there is no reason why applying Martingale won’t fetch you dividends.