90% failing rate , its true ?
- Thread starter Ahmed Solaiman
- Start date
that's actually true.
Actually, the firm I trade through is required by the regulator here in the UK to publish their loss-making clients percentage: this is currently 80%. the other firms in the sector generally publish numbers in the 70-80% bracket.
The number might be different in e.g. the US, where market access is available through different structures but its probably a decent estimate.
A 2014 research study carried out by the European Central Bank using information gathered from leading European brokerage firms reportedly found that close to 70% of retail Forex traders are losing money overall while trading foreign currency pairs.
Similarly, a survey conducted by Chris Davison of Trent University in London found that, according to the self-reporting of traders responding to his questionnaire, only 18% made a large profit over the previous six months with another 19.5% making a small profit.
Approximately 63% of those that remained said they either broke even, experienced a small loss, or suffered a large one.
Similarly, a survey conducted by Chris Davison of Trent University in London found that, according to the self-reporting of traders responding to his questionnaire, only 18% made a large profit over the previous six months with another 19.5% making a small profit.
Approximately 63% of those that remained said they either broke even, experienced a small loss, or suffered a large one.
70 to 80%, is over 3 months.
The longer you sample, the higher the figure goes.
In forex it will be 95% of forex traders will fail after 2 years.
Really thats no different than most other businesses.
Still 1 in 20 will still be around after 2 years. But only 1 in 100 (or less) will have the ability to make big money in forex.
I think stock and stock index trading has higher win rate than forex. Forex is a lot harder, too much insider info and too many random price spikes.
Is there even one forex trader on this board who will admit to consistently making >100K a year in forex??
There maybe some here, but out of a board membership of 1000s, there wont be many.
According to what reputable study or empirically gathered data?
Its obvious, dont need studies to point out the obvious:
There is a big bias towards winners in surveys of profitable forex traders. Because most of the losing accounts have long been shutdown or become inactive and so wont be included in the stats.
If you talk about official broker statistics I think the goal is to calculate share of the traders who stayed afloat/above breakeven after 1/3/6 months of trading and it doesn't matter when a trader opened his account and if it became inactive later.
The problem with that method of calculation, a profitable trader opening and closing an account in 1 week would be deemed profitable, however over a longer time frame would wipe out.
A winner in a short period, if he then kept trading for 10 years could highly likely be a big time loser multiple times.
Hence, a short window is not a true reflection because short term might have also been during a favorable global conditions which slants the results.
Like an index, if they keep weaning out the losers from the base, then it's not a true reflection.