Why do smaller accounts lose money faster in the same market conditions?

Just look at this comparison. The wealthy person has 10 million, and a 10% market increase yields a million-dollar profit, enough to sit tight and wait for opportunities. But someone with only 100,000 yuan, even with the same percentage increase, only makes 10,000—completely unable to cover living expenses.

People with less money are most likely to fall into a vicious cycle: their accounts are too small, so profits can't cover daily expenses. They constantly look for opportunities and trade frequently, hoping that diligence can make up for insufficient principal. But what happens? The more they trade, the higher the fees, the more chaotic their mindset becomes, and the more mistakes they make. In the end, they don't make money; instead, they lose more and more.

The problem isn't the market's good or bad conditions, but the size of your capital determines how much fluctuation you can withstand. When your account balance doesn't match your living expenses, you simply can't stay calm and analyze the market like big players.