The Pareto Principle in Trading

The 80/20 rule states that roughly 80% of effects come from 20% of causes.

What It Looks Like in Trading

• 80% of your profits come from 20% of your trades
• 80% of your mistakes come from 20% of your bad habits
• 80% of your edge comes from 20% of your setups

How to Apply It

1. Analyze your trading journal — Which 20% of setups produce 80% of profits? 2. Cut the bottom 80% — Why trade setups that barely work? 3. Focus exclusively on your top setups — For one month, only trade the 20% that works.

Beyond Trading

• 20% of your study time produces 80% of your knowledge
• 20% of your indicators give you 80% of the information
• 20% of your prep produces 80% of your readiness

The Action Step

Review your journal. Find your 20%. Drop the rest.

You don't need more strategies. You need to execute your best ones better.