5% of traders that make money

Quote from virgin:

Don,



Do you have a more accurate figure of how much of new traders become seasoned ?
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Do a search on ET, I have posted the same numbers that we report to the regulators many times. Something like this (not exact)...we lose about half the first year (not bad since 90% of all business ventures fail the first year), and we might lose another 10-20% or so the next year...by the third year, everyone is pretty much making money or they wouldn't be here.

Of course it takes constant training/mentoring for many to stay ahead of the game. And yet, those who have been with us forever seem to make money no matter what is thrown at them.

As always, I wish that any (any) other Firm would come forth with any (any) numbers whatsoever...never seems to happen.

All the best,

Don
 
Personally , I think that they hear thought and will pool their resources for as long as it takes to cause losses among those they see as threats- amaranth for example- a weapon , not a fund.
 
Quote from Don Bright:

Do a search on ET, I have posted the same numbers that we report to the regulators many times. Something like this (not exact)...we lose about half the first year (not bad since 90% of all business ventures fail the first year), and we might lose another 10-20% or so the next year...by the third year, everyone is pretty much making money or they wouldn't be here.

Of course it takes constant training/mentoring for many to stay ahead of the game. And yet, those who have been with us forever seem to make money no matter what is thrown at them.

As always, I wish that any (any) other Firm would come forth with any (any) numbers whatsoever...never seems to happen.

All the best,

Don
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I'd be curious as to your views on why those 50% fail the first year. Personal finances not in order? Personality not suited for day trading? I'm sure many have no one but themselves to blame due to poor preparation, but where do you think your training was lacking, and if so, what can you do to better serve your traders.
This is not meant to be a slam against you as you seem to be very forthcoming with all the gory details. Maybe just something for you to think about from a pure business perspective. The higher your success ratio is, the better your recruitment would be, or so it would seem.
 
as others have said - trading with the big money is where it's generally at, unless *everyone* is on the one side of a trade. then it's good to carefully fade them.

my stock 'world' isn't generally populated by the big boys, and when it is, they're usually waiting to put on a huge position (by fading). i'll often fade moves, knowing i'm not fading all the big players, but the speculators / joe 6packs at home who think *this* stock is going to be their next million.


i'm trying to learn about the more liquid areas (commodities, forex) in my spare time, to hopefully expand my horizons to those areas. when i do, i'll be doing a LOT less fading, and a lot MORE following the big money.


one thing i learned, however - i never, EVER fade a move on no news in a bank stock. i've seen so many instances where an unknown bank stock will move on price and volume for an afternoon, maybe 2 or 3 days, and nothing - then bang, a buyout. and it's so obvious that people knew about the deal in advance, bought up on it, and made a quick profit.
 
Quote from CaptainObvious:

I'd be curious as to your views on why those 50% fail the first year. Personal finances not in order? Personality not suited for day trading? I'm sure many have no one but themselves to blame due to poor preparation, but where do you think your training was lacking, and if so, what can you do to better serve your traders.
This is not meant to be a slam against you as you seem to be very forthcoming with all the gory details. Maybe just something for you to think about from a pure business perspective. The higher your success ratio is, the better your recruitment would be, or so it would seem.
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Well, the phrase "leading a horse to water" comes to mind, and some people just aren't cut out to work hard enough to make this gig work for them. Even at that, I guess we're 500% better than the "average"business venture.

Many leave, not for financial reasons, but for the very reasons stated above...not willing to apply themselves well enough, or spend enough time each week (off market hours) to make things work. Believe me, we can teach 10 people the same thing, ask them for a review 6 months later and only half will even have a journal, a business plan, a detailed p&l analysis, generally some of the things to "make it work".

So many simply expect this to be "easy" - and it's not. It is "simple" (trading is simple overall)...but not "easy" - you have to work at it, listen to others (another problem, LOL), and be willing to say "I dont' understand" rather than just sit there and smile...with their ego's infringed upon.

BTW, don't ever fear giving me or any of my people constructive suggestions...we are always adapting and modifying our various programs.

Thanks!!

Don
 
Quote from traderdragon2:

Anyone who doesnt think this is going on is naive.
With millions at stake, it becomes easy to talk thru secret channels without ever getting caught.

Hell, anyone can get military grade encryption with chat clients and talk directly to the guy on the other side of that firewall on a third party server, out on the internet, and the SEC will never trace them or crack their communications.

Its a complete joke. Its too easy to do, and there is lots of free software out there that will enable you to do it.

Hey wait sec, why go high tech like this at all? Just buy a prepurchased anonymous cell phone and talk all you want with the other guy.

Drug dealers do it, surely youre smarter than a drug dealer mr hot shot broker LOL
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Thank you. Best post on the thread.
 
If you were even caught with any type of equipment that would circumvent the servers on a Wall Street firm your next stop is Federal Pen....

My guess is a very loud alarm would go off if that was even attempted....

EVERY phone call, email, fax, letter and any other form of communication is recorded and filed for later use if necessary...

If some trader is talking on a cell phone he would be removed from the floor by security at once....

You guys are nuts......

Bank stocks: When volume/price increases for no apparent reason it should be a very large hint that a buy-out is working...

ALL banks sell the same product: MONEY....no FDA approval, no new product like I-Pod, Panama, Vista etc etc...

Like Don Bright said.....got to do your homework, boys and girls...


If one looks back on these "shocking surprises" one can usually find indications before hand, if one had only paid attention...

Any shock that Home Depot having trouble??? ET been talking about homebuilders for last year......duh...

Open your eyes and ears......information is all around you



SteveD
 
WEll, its easy for those prop traders to get in positions at amazing prices... they have the buying power to drive down a security until it hits a lot of professionals' stop losses then drive the price back up and let the market consensus do the rest
 
Let's not forget that alot of these scenarios work out over a period of days or weeks. No need to use cell phones and IM..there is this little thing called LUNCH, where people on Wall St. exchange info. A phone call or email need only be "hey, let's get a drink at lunch". All the pertinent details exchange orally. No offense, but the Wall St. insiders coming on here saying we are all crazy sound like crybabies.
 
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