why 95% lose

[jamit_05]

Trading was never a zero sum game. Even if you have a scratch trade means bough at 100 Rs and sold at 100 Rs still then you go home red as you have to pay brokerage and taxes. I read a recent paper on day traders the author studied the day trader trades history from 1996 to 2013 i think. Most of the traders were positive without taxes and brokerage but when brokerage, taxes and expenditures included they went negative. This paper has interesting statistics... go through it

http://faculty.haas.berkeley.edu/odean/papers/Day Traders/Day Trading Skill 110523.pdf

Fair enough. Trading is a negative sum game due to brokerage, taxes and slippage. This is why intra-day trading is the thing for the top-notch experts. Most others must reduce the number of trades. Trade positionally perhaps.

 

[onlinegtrash]

...

Now I am telling you a hard fact:-

Currently in India out of almost 127 Cr population there is only about 5 lakh Active Traders (whole 100%).
Actual fact is percentage of winners among new trader is less than 2 percent.
Actual research shows winners in USA (where market is pretty old and good technology is available with beginners also) is about 8%. But out of which 80% are old winners who wins regularly. So rest 20% of winners group are new. Which is about 1.6% of total traders.
Some old winners also get out of system and new winners enter there and fresh winners take their places. That is the whole process.

So out of one thousand new trader only 16 person survive ultimately & enter to new traders group. That why we see very few successful trader TJ too. Most of them are in this market more than 5-7 years.
...

H.C

Incredible stats!

 

[stock72]

Mine is I can do it

 

[anuragmunjal]

why 95% loose....
financial market is like a maze. when one enters and gets lost, one tends to use all tools in the book, ie. going forward, going backward, going left, going right... to get out. this makes 'getting out' more complex.
one can get much better results if one uses only 'the left hand' or 'the right hand ' method to navigate. this sadly comes after a lot of experience.

http://www.nytimes.com/1989/09/06/opinion/l-why-right-hand-rule-for-mazes-works-075389.html

regards

 

[onlinegtrash]

why 95% loose....
financial market is like a maze. when one enters and gets lost, one tends to use all tools in the book, ie. going forward, going backward, going left, going right... to get out. this makes 'getting out' more complex.
one can get much better results if one uses only 'the left hand' or 'the right hand ' method to navigate. this sadly comes after a lot of experience.

http://www.nytimes.com/1989/09/06/opinion/l-why-right-hand-rule-for-mazes-works-075389.html

regards

yeah, a simple maze solving rule often solves the maze!
https://youtube.com/watch?v=NA137qGmz4s

 

[copypasteaee]

Fair enough. Trading is a negative sum game due to brokerage, taxes and slippage. This is why intra-day trading is the thing for the top-notch experts. Most others must reduce the number of trades. Trade positionally perhaps.

Bigger the time frame, the greater are the chances of winning. We can not win from Algos/ HFTs on their home turf. We can not beat them in speed when they are having co-location servers. Just reminds me of a friend who opted for a algo machine for some sure shot arbitrage strategy. His algo machine rarely used to get trades as the co located machines just don't leave any thing on the table.

and on lower time frame the chances of SL running is also large. So i recommend to use bigger time frame for all newbies. A min of one hour that too is under risk of SL running sometime.

Personally i am a failure in future trading but i am making my money from option writing from a pro account. i am using a algo machine to write options and that is my main source of income. futures i am trying to figure out.....

 

[manishchan]

Agreed.

Moreover, only the ones who are naturally set to allot 5 to 10 years to trading will see light of day.

While any skill takes time to learn, not necessarily everyone has to spend a decade to learn things. People have their own learning curve. Some take 5 years to trade profitably while others do it within a year or two. And I'm talking abt being consistently profitable. Again nothing wrong wid either of the time span taken but people aspiring to be a trader must learn that it is not an easy path. Having said dt, skills only get better with more time and practice.

I would say average 1-2 years of full time effort and full focus is good enough to start being profitable. And this 1-2 should be step by step of learning methods, testing them, practicing them and sticking to it. Not d types where one learns about candlestick pattern today and starts trading tomorrow makes some profit here and there and then becomes a jumping jack in search of AFL's, indicators and holy grails. You can't become a profitable trader like this even if you spend your whole life trying. You have to define a path and stick to it. Dtz all. And if you can't do that then better look for other things in life. Trading is not the only profession in the world.

 

[copypasteaee]

While any skill takes time to learn, not necessarily everyone has to spend a decade to learn things. People have their own learning curve. Some take 5 years to trade profitably while others do it within a year or two. And I'm talking abt being consistently profitable. Again nothing wrong wid either of the time span taken but people aspiring to be a trader must learn that it is not an easy path. Having said dt, skills only get better with more time and practice.

I would say average 1-2 years of full time effort and full focus is good enough to start being profitable. And this 1-2 should be step by step of learning methods, testing them, practicing them and sticking to it. Not d types where one learns about candlestick pattern today and starts trading tomorrow makes some profit here and there and then becomes a jumping jack in search of AFL's, indicators and holy grails. You can't become a profitable trader like this even if you spend your whole life trying. You have to define a path and stick to it. Dtz all. And if you can't do that then better look for other things in life. Trading is not the only profession in the world.

if a trader is profitable with 1 lot of BNF, will he be successful with 10 lots of BNF with same strategy?

 

[manishchan]

if a trader is profitable with 1 lot of BNF, will he be successful with 10 lots of BNF with same strategy?

Definitely.. Yes but only if :

1. The strategy is well defined and tested over long period of time with positive expectancy.
2. Person is not over leveraging just to be able to trade 10 lots.
3. Sticks to the defined R:R and money management and never over trades, takes higher risk than his/her capital allows to.
4. See the profit or loss in terms of points and not money.
5. Increase in the number of lots step by step as you make profits and not haphazardly. Decrease lots when you make losses.

 

[copypasteaee]

Definitely.. Yes but only if :

1. The strategy is well defined and tested over long period of time with positive expectancy.
2. Person is not over leveraging just to be able to trade 10 lots.
3. Sticks to the defined R:R and money management and never over trades, takes higher risk than his/her capital allows to.
4. See the profit or loss in terms of points and not money.
5. Increase in the number of lots step by step as you make profits and not haphazardly. Decrease lots when you make losses.

no ifs and buts in trading my dear friend.....