Many new traders feel making huge sustained income is quite impossible after suffering some losses. But then it is possible, just choose one currency pair; focus on a trading system and dedicate much time to learning and making the strategy better.
How Common Are Really Large Successful Traders
- Thread starter Fundlord
- Start date
I asked Mr. Google and here are two articles:
https://vantagepointtrading.com/archives/13922
Conclusion:
Only 3.5% - 4.5% day traders were profitable over a 5-year observation period by the author. The odds are actually much better than making it as a professional basketball player.
Another academic study, by UC Berkeley et al looking at day trading in Taiwan:
http://www.econ.yale.edu/~shiller/behfin/2004-04-10/barber-lee-liu-odean.pdf
Conclusion:
Our analysis of performance indicates day trading is treacherous, but not entirely a fool's game. Heavy day traders, as a group, earn gross profits (before transaction costs). Thus, heavy day traders do appear to have a trading advantage over other investors. The stocks bought by the most active day traders outperform those sold by 31 basis points per day. Unfortunately, the gross profits of heavy day traders are not sufficiently large to cover reasonable estimates of transaction costs. Thus, as a group, they lose money. In contrast, occasional day traders experience both gross and net losses. The stocks bought by occasional day traders actually underperform those sold, even before considering transaction costs.
i.e., day trading is a negative sum game but probably as the first article concluded, a small percentage of traders were profitable.
I am beginning to ask if trading options, which I do full time, is the same?
After commissions, fading the bid/ask spread, and facing an informational disadvantage, a retail trader sitting at home has almost no chance daytrading options.
500k is 5% on a 10mil account, not even a return to boast about. Those guys might not be living in a basement but there are definitely numerous individuals with that kind of money and significantly more in the markets.
Those of us that make money trading, do it under the radar. I've personally never chased he 7,8, and 9 figure pay days. My goal was always to make enough to never to back to a 9-5.
I've always had a goal of $10-$15k a month trading, $7-8k real estate income, $3k per month dividend income, and $2k per month in part time business.
Been trading for years, and can definitely make more than $10-$15k per month nowadays, but less stress means more to me than chasing millions. Time is money. Making more money doesn't make you happy, but it does solve the time and money equation.
I've always had a goal of $10-$15k a month trading, $7-8k real estate income, $3k per month dividend income, and $2k per month in part time business.
Been trading for years, and can definitely make more than $10-$15k per month nowadays, but less stress means more to me than chasing millions. Time is money. Making more money doesn't make you happy, but it does solve the time and money equation.
Interesting.
f your post is correct. No need to stress out. I have a position to fill, that you surely qualify for, that will be lucrative enough and without stress.
Interesting.
f your post is correct. No need to stress out. I have a position to fill, that you surely qualify for, that will be lucrative enough and without stress.