If most ppl lose when they try to win $$, what happens when they "try" to lose $?

tony.m said:
India reports percentage of traders who make money each year.
In 2022
Number of F&O traders 4.57 million
Losers 89%
Average loss US ~$1500 per year

Winner 11%
Average profit US ~$2000 per year

The top 1 percent takes 51% of the total net profit.
The top 5 percent take 75% of the total net profit.

Here is the link if anyone is intrested.
https://www.sebi.gov.in/reports-and...rs-dealing-in-equity-fando-segment_67525.html
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that's some very cool & detailed stats you found

with back-of-envelope calculations on the above,

eg. 11% winners: 0.11 x 4.57 million = 502,700 winning traders in the mix
total net profit = 502,700 x US$2000 = US$1,005,400,000 just over a billion US dollars net
within the top 1%, since they made 51% of the total net, would be
45700 traders (1% of the total 4.57 million traders) sharing 51%x US$1,005,400,000
or US$11200 average in the top 1%

that'd be equivalent to the top 1% retail trader in India making roughly 6x the annual average income per year just from trading (google search estimates around 150k Indian rupees annual income, or US$1800)

assuming the distribution of ratios is not that different in the US, 6x avg national income would be $225k (https://fred.stlouisfed.org/series/MEPAINUSA672N)

so if you're making $225k from trading profits in the US, that'd place you well within the top 1% of retail traders (bc with the 80-20 pareto like distribution, or actually 99-1 distribution, likely the top 0.01% of retail traders get 30% of profits etc)
 
pinetboltz said:
you know how most people don't make much money even when they try so hard?
eg. most traders lose when they try so hard to make $$ trading?
More...

Good grief! If you are going to succeed in trading the markets, you need to know (1) when/where to make a play and (2) WHY that play should work (because it's probably correct this time as it has historically been correct a significant percentage of the time in the past). If you can't "get to that point", there is little hope.

Trying to trade "the opposite of what you feel" is ridiculous!
 
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1) One reason to why traders lose is transaction costs. Those can unfortunately not be inverted, unless you start a market making business.
2) "Inverting yourself" in a vacuum as a discretionary trader is patently ridiculous, you're likely to change something. Maybe you could do it by trading into a black box that may or may not decide to invert your signal.
3) Chances are your alpha is zero as a losing trader, no more, no less. Only it seems like you have negative alpha due to point #1 above. This means there's nothing to gain by inverting.
 
Scataphagos said:
Good grief! If you are going to succeed in trading the markets, you need to know (1) when/where to make a play and (2) WHY that play should work (because it's probably correct this time as it has historically been correct a significant percentage of the time in the past). If you can't "get to that point", there is little hope.

Trying to trade "the opposite of what you feel" is ridiculous!
More...
Best post on ET for the month of March.
 
pinetboltz said:
ok, so the thought experiment came to me over the weekend, thinking about VC investments (those who burn cash fastest try to earn it back on "market valuations") and reverse psychology and the Parasite movie which i'd watched on the plane (the one from 2019 which won best picture, i can see how it mirrors the zeitgeist)

you know how most people don't make much money even when they try so hard?
eg. most traders lose when they try so hard to make $$ trading?

what happens if they make it a game where they "try" to lose $$?
eg. instead of having the "goal" of growing an account from $X, they try to LOSE the whole wad, as fast as possible?

before you say, "isn't that what they're doing at r/wallstreetbets" LOL, i think those options guys are either/ some combination of:
- very rich, and can thus be so nonchalant in essentially playing $100k hands of poker on their personal cash, burning through their bankroll
- very young, with early access to their trust funds which they'll surely squander
- very desperate for attention, that they'll take such random throws of the dice/ earnings plays for social media clout
- very good at photoshop

but let's say for pure FX, futures, stocks, etc
if ppl are given free reins to trade however they want, with the stated objective of "losing" the whole account (first down to 0 wins) as fast as possible, what do you reckon would happen?
- would they still lose $$
- or would they paradoxically make $$ (kinda ironic)

has anyone tried doing this by playing on demos? keen to hear your stories
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LMFAO HAHAHAHAHHAHAAHHA

I hear you man. I hear you man
 
pinetboltz said:
ok, so the thought experiment came to me over the weekend, thinking about VC investments (those who burn cash fastest try to earn it back on "market valuations") and reverse psychology and the Parasite movie which i'd watched on the plane (the one from 2019 which won best picture, i can see how it mirrors the zeitgeist)

you know how most people don't make much money even when they try so hard?
eg. most traders lose when they try so hard to make $$ trading?

what happens if they make it a game where they "try" to lose $$?
eg. instead of having the "goal" of growing an account from $X, they try to LOSE the whole wad, as fast as possible?

before you say, "isn't that what they're doing at r/wallstreetbets" LOL, i think those options guys are either/ some combination of:
- very rich, and can thus be so nonchalant in essentially playing $100k hands of poker on their personal cash, burning through their bankroll
- very young, with early access to their trust funds which they'll surely squander
- very desperate for attention, that they'll take such random throws of the dice/ earnings plays for social media clout
- very good at photoshop

but let's say for pure FX, futures, stocks, etc
if ppl are given free reins to trade however they want, with the stated objective of "losing" the whole account (first down to 0 wins) as fast as possible, what do you reckon would happen?
- would they still lose $$
- or would they paradoxically make $$ (kinda ironic)

has anyone tried doing this by playing on demos? keen to hear your stories
More...


Loss and positive return traders are cancel each other and the mean return is zero. That's all you need to know. This is one of the key things you can judge about with some certainty.
 
Most of those who day trade futures don't realize, commissions will add up to 100% of their small accounts at end of the year. So many will have to do 100% just to breakeven.

It be better to save more funds and swing trade, risk little for much larger profits.
 
pinetboltz said:
ok, so the thought experiment came to me over the weekend, thinking about VC investments (those who burn cash fastest try to earn it back on "market valuations") and reverse psychology and the Parasite movie which i'd watched on the plane (the one from 2019 which won best picture, i can see how it mirrors the zeitgeist)

you know how most people don't make much money even when they try so hard?
eg. most traders lose when they try so hard to make $$ trading?

what happens if they make it a game where they "try" to lose $$?
eg. instead of having the "goal" of growing an account from $X, they try to LOSE the whole wad, as fast as possible?

before you say, "isn't that what they're doing at r/wallstreetbets" LOL, i think those options guys are either/ some combination of:
- very rich, and can thus be so nonchalant in essentially playing $100k hands of poker on their personal cash, burning through their bankroll
- very young, with early access to their trust funds which they'll surely squander
- very desperate for attention, that they'll take such random throws of the dice/ earnings plays for social media clout
- very good at photoshop

but let's say for pure FX, futures, stocks, etc
if ppl are given free reins to trade however they want, with the stated objective of "losing" the whole account (first down to 0 wins) as fast as possible, what do you reckon would happen?
- would they still lose $$
- or would they paradoxically make $$ (kinda ironic)

has anyone tried doing this by playing on demos? keen to hear your stories
More...

If you try to win you lose at a given variable speed determined by market forces and your choices, if you try to lose you lose spectacularly fast, someone I know ran the numbers and the NYSE can absorb an Accredited Investors nest egg in seconds, the world works on trying to win faster than the next person.

https://www.elitetrader.com/et/threads/unregulated-broker.373473/page-2#post-5790095

It relates to above, the key is what I do via the people I know, you stay inert not losing while still having market exposure, until such time some third party rolls crap down the hill and you layer winning alongside it.

iu


Apparently everyone on this site likes this type of thing, every piece of fintech, methodology, process, knowledge I have access to works on this basis, from the top down, you will never find it anywhere else except those provided with a golden goose like Buffett or at levels of institution and sovereign.

It works for everything, health, lifestyle, markets, corona, inflation, careers, winning and losing today are starting to correlate, all you can now do is profit alongside sovereign wealth and institutional movements, not many in the world that can track those before they have finished :)
 
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