Day Trading Stats

I think that the argument of traders being born or made is way over-blown and so is the analysis of these statistics. Trading is not magic, it is a business! New businesses fail all the time, in fact start up businesses fail at an alarming rate and that is exactly what happened to most of these traders who emerged during the bull market. These people (businesses) were attracted by perceived opportunities and for various reasons are no longer around. The level of failure is not due to the fact that in order to survive you have to be a born superstar or phenom, it is due to a whole host of factors.

Let's face it this industry, especially during the bull market, has had low barriers to entry. Any industry like that is going to have a high rate of attrition. Undercapitalization, lack of proper/any training, volatile market conditions, all caused the heard to be culled. It would be interesting to see the stats on how the ranks of the so called semi-pro trader ballooned in the years leading up to the 2000 peak.

I love trading and I can't imagine anything else I'd rather do for a living. It has taken me some time to have success and a great deal of time to make a decent living but just like many other businesses anyone who is prepared to invest the proper amount of resources (financial and mental) in trading can be successful. Its not for everyone, but hey what business is.

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Interesting discussion. To expound upon my earlier post, how do you know if someone, such as yourself, is "truly committed" while it's happening? Or do you solely judge such a commitment by the results, that is, if someone is very successful they must have been "truly committed", if not successful then the poor fool really wasn't, he just thought he was....

In other words, it's a useless criteria when you have to wait (years?) for the results to see if you were "truly committed". And if you don't have to wait, if you just know right now that you are indeed "truly committed", then what happens if you fail to reach the success you aspire to? What good did the psychological balm of thinking you were "truly committed" do, what difference did it make in terms of producing results in the real world? Answer: NONE.

Bottom line? Give up this notion that if you're "truly committed" you will definitely make it. Otherwise you will forever be negatively judging yourself and doubting your so-called "commitment" unless the results pan out. Instead, work very hard, keep fighting as best you can, use all the resources you have, and hopefully down the road there will come a fortuitous turn of events or insights leading to a level of success. Or you will run out of money. Depends on your talent and your ability to absorb the daily lessons of the market, and how expensive those lessons are relative to your account size.

As Brandon says, it doesn't matter how hard or long his Uncle Lyle practices the guitar, he'll never be a Jimi Hendrix, Eric Clapton, etc. If the talent is there, coupled with hard work (or "commitment", whatever you want to call it...) then there is increased likelihood for success. If the talent is not there, the hard work will make you a better guitar player than you would have been, but that frequently doesn't translate into success.
 
Quote from Magna:

Interesting discussion. To expound upon my earlier post, how do you know if someone, such as yourself, is "truly committed" while it's happening? Or do you solely judge such a commitment by the results, that is, if someone is very successful they must have been "truly committed", if not successful then the poor fool really wasn't, he just thought he was....

In other words, it's a useless criteria when you have to wait (years?) for the results to see if you were "truly committed". And if you don't have to wait, if you just know right now that you are indeed "truly committed", then what happens if you fail to reach the success you aspire to? What good did the psychological balm of thinking you were "truly committed" do, what difference did it make in terms of producing results in the real world? Answer: NONE.

Bottom line? Give up this notion that if you're "truly committed" you will definitely make it. Otherwise you will forever be negatively judging yourself and doubting your so-called "commitment" unless the results pan out. Instead, work very hard, keep fighting as best you can, use all the resources you have, and hopefully down the road there will come a fortuitous turn of events or insights leading to a level of success. Or you will run out of money. Depends on your talent and your ability to absorb the daily lessons of the market, and how expensive those lessons are relative to your account size.

As Brandon says, it doesn't matter how hard or long his Uncle Lyle practices the guitar, he'll never be a Jimi Hendrix, Eric Clapton, etc. If the talent is there, coupled with hard work (or "commitment", whatever you want to call it...) then there is increased likelihood for success. If the talent is not there, the hard work will make you a better guitar player than you would have been, but that frequently doesn't translate into success.
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VERY WELL SAID!
 
Quote from Magna:

Interesting discussion. To expound upon my earlier post, how do you know if someone, such as yourself, is "truly committed" while it's happening? Or do you solely judge such a commitment by the results, that is, if someone is very successful they must have been "truly committed", if not successful then the poor fool really wasn't, he just thought he was....

In other words, it's a useless criteria when you have to wait (years?) for the results to see if you were "truly committed". And if you don't have to wait, if you just know right now that you are indeed "truly committed", then what happens if you fail to reach the success you aspire to? What good did the psychological balm of thinking you were "truly committed" do, what difference did it make in terms of producing results in the real world? Answer: NONE.

Bottom line? Give up this notion that if you're "truly committed" you will definitely make it. Otherwise you will forever be negatively judging yourself and doubting your so-called "commitment" unless the results pan out. Instead, work very hard, keep fighting as best you can, use all the resources you have, and hopefully down the road there will come a fortuitous turn of events or insights leading to a level of success. Or you will run out of money. Depends on your talent and your ability to absorb the daily lessons of the market, and how expensive those lessons are relative to your account size.

As Brandon says, it doesn't matter how hard or long his Uncle Lyle practices the guitar, he'll never be a Jimi Hendrix, Eric Clapton, etc. If the talent is there, coupled with hard work (or "commitment", whatever you want to call it...) then there is increased likelihood for success. If the talent is not there, the hard work will make you a better guitar player than you would have been, but that frequently doesn't translate into success.
More...


What is talent when it comes to trading. I would define it as the abiltiy to extract profits consistently while maintaining a risk contol posture which puts you in a very likely position to be able to continue trading indefinitely. My point is this isn't something your born with. Its is a learned behavior or skill or whatever you want to call it. Trading is a unique profession. Your analogy to pro basketball is inaccurate because that is an area where someone could really be "committed" and not make it. Physical attributes are not something we can change about ourselves. You also have a very short time window to make it even if you have the physical makeup. A guy with innate talent could do poorly summer camp and never get invited back.

Trading IS different. There is no time limitation, and as I mentioned it is more of a learned skill rather than something you either have or don't have. Being truthful with yourself is critical however. You must see that you efforts are moving in the right direction. As I've said before, it takes time. For most lots and lots of time. You make a business plan and you check in to measure your progress. We obvoiusly disagree here on this point. I believe that most losing traders could win if they adopted a better attitude and stopped looking for the easy road. This is more of a theoretical discussion. In reality, there will always be a much a larger percentage of losing traders vs. winners. But in my mind, attitude IS what ultimately seperates the winners from the losers.

So Magna, what is it that you believe is true in life. I differ from you because I believe a man (or woman) can control their destiny in certain matters. Trading is an area where you can do this. Your example of someone believing in themselves but ultimately losing is flawed in my opinion, because if they truly believed in themselves they wouldn't lose. An individual who wishes to succeed in trading will need 3 things. Belief, Honesty, and a ton of hard work! They may never be the Jimi Hendrix or Eric Clapton of trading, but they could secure a place for themselves in the
profession.

On last point to add here. The majority of people in any given competitive field if asked whether they were "truly committed" would most likely answer yes. I think the reality is that they truly aren't but just want to say they are. A study of successful people in many areas reveals a common thread amongst them. They have adopted an attitude that this is what they want for themselves and they are willing to do whatever they must to achieve their goal. Very few people in the "real world" actually practice this.
 
(Trading IS different. There is no time limitation, and as I mentioned it is more of a learned skill rather than something you either have or don't have. Being truthful with yourself is critical however.)

What type of trading? Trading on or off the floor, etc. I would add that these are important inputs that need to be evaluated before stating that ALL trading is a "a learned skill". REACTION TIME and CONCENTRATION levels (abilities) for the most part are not a learned behavior skill, but an attribute you have or you don't have.

Yet, my experience and reading tells me also that our GROWTH and DEVELOPMENT from childhood IS adjust as important in discussing the profitability or lack thereof of a trader. This would be another KEY ingredient when discussing what makes a trader successful especially over the long haul.
 
Not going into details ... but to follow up on my post - I know of an experience where a trader was trained to take advantage of the market ALL DAY LONG. But the trader had to watch prints and the market all day. IF they could just have done that, they had money "in the bag" each and everyday.

This person JUST could not sit, and watch the market. This trader JUST DID NOT HAVE THE ABILITY to concentrate for the duration of the trading day.

This trader was taught and mentored, BUT because of the lack of talent and ability to concentrate they DID NOT MAKE IT as a trader.

So here is a perfect example, whereby having some notion of "BEING COMMITTED" would have paid the trader on a daily basis.
 
Quote from harmonicpatrick:

Not going into details ... but to follow up on my post - I know of an experience where a trader was trained to take advantage of the market ALL DAY LONG. But the trader had to watch prints and the market all day. IF they could just have done that, they had money "in the bag" each and everyday.

This person JUST could not sit, and watch the market. This trader JUST DID NOT HAVE THE ABILITY to concentrate for the duration of the trading day.

This trader was taught and mentored, BUT because of the lack of talent and ability to concentrate they DID NOT MAKE IT as a trader.

So here is a perfect example, whereby having some notion of "BEING COMMITTED" would have paid the trader on a daily basis.
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Not to be too contentious, but WRONG.BZZZT! If this individual truly wanted to be a trader, they would change their strategy so they don''t have to sit and watch the market all day long.
 
Quote from SimpleSimon:




Not to be too contentious, but WRONG.BZZZT! If this individual truly wanted to be a trader, they would change their strategy so they don''t have to sit and watch the market all day long.
More...

Depends on the style. In some styles, you need to watch all day long.
 
Quote from SimpleSimon:




What is talent when it comes to trading. I would define it as the abiltiy to extract profits consistently while maintaining a risk contol posture which puts you in a very likely position to be able to continue trading indefinitely. My point is this isn't something your born with. Its is a learned behavior or skill or whatever you want to call it. Trading is a unique profession. Your analogy to pro basketball is inaccurate because that is an area where someone could really be "committed" and not make it. Physical attributes are not something we can change about ourselves. You also have a very short time window to make it even if you have the physical makeup. A guy with innate talent could do poorly summer camp and never get invited back.

Trading IS different. There is no time limitation, and as I mentioned it is more of a learned skill rather than something you either have or don't have. Being truthful with yourself is critical however. You must see that you efforts are moving in the right direction. As I've said before, it takes time. For most lots and lots of time. You make a business plan and you check in to measure your progress. We obvoiusly disagree here on this point. I believe that most losing traders could win if they adopted a better attitude and stopped looking for the easy road. This is more of a theoretical discussion. In reality, there will always be a much a larger percentage of losing traders vs. winners. But in my mind, attitude IS what ultimately seperates the winners from the losers.

So Magna, what is it that you believe is true in life. I differ from you because I believe a man (or woman) can control their destiny in certain matters. Trading is an area where you can do this. Your example of someone believing in themselves but ultimately losing is flawed in my opinion, because if they truly believed in themselves they wouldn't lose. An individual who wishes to succeed in trading will need 3 things. Belief, Honesty, and a ton of hard work! They may never be the Jimi Hendrix or Eric Clapton of trading, but they could secure a place for themselves in the
profession.

On last point to add here. The majority of people in any given competitive field if asked whether they were "truly committed" would most likely answer yes. I think the reality is that they truly aren't but just want to say they are. A study of successful people in many areas reveals a common thread amongst them. They have adopted an attitude that this is what they want for themselves and they are willing to do whatever they must to achieve their goal. Very few people in the "real world" actually practice this.
More...

This is like saying that playing the guitar is purely learned. Yes, everyone can learn to play it, but some people will never play it at a level where anyone (even the player) wants to hear it. Others have a talent. The basketball analogy is very reasonable, because there are many very athletic people who don't have the right decision making skills, toughness, work ethic, etc to be in the NBA, even though this player may be as tall and more athletic than most NBA players. Music is probably better to illustrate, however. The fact is, not everyone can analyze live information equally well, not everyone can adapt equally well, not everyone can take "pain" equally well, etc etc etc.

By the way, the point I believe Magna was making with regard to committment is that no matter how much someone actually is committed, if they fail to succeed, those who say all success is dependent on committment will simply say that this person was "not committed." the subjective nature of determining and describing "committed" lends itself to these problems with generalizations and accusations. After all, some successful people can put more effort into an hour of research than others who are unsuccessful put into multiple hours, but how can most people tell the difference. Nevermind the fact that there are people who work their tails off (I've seen it plenty) and still fail to succeed, while others who in fact will be the first to admit that they are lazy and put little effort in succeed day in and day out. Good mentoring, "committment" and hard work are important (and some people fail primarily on these grounds), but talent is key as well.
 
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