is trading less riskier then starting a business?

[smallStops]

Quote from hanzahar:

if starting a business is less riskier then day trading... why people day trade? because people assume they have better chances of succeeding and it is easier? (low cost)

people assume trading is the same as trading profitably in a consistent way. Trader , and consistently profitable trader are actually two different things, though the latter is included in the former.

So they do not see the real barriers to entry.
When they realize, many give up.

 

[Bob111]

Quote from hanzahar:

if starting a business is less riskier then day trading... why people day trade? because people assume they have better chances of succeeding and it is easier? (low cost)

it's definitely not easier,but faster(and more stressful). if you have winning system that you can spread across the stocks-you can make money every single day regardless to general direction of the market. i've done it.but if you have losing systems-you will lose money super fast

 

[hanzahar]

Quote from Bob111:

it's definitely not easier,but faster(and more stressful). if you have winning system that you can spread across the stocks-you can make money every single day regardless to general direction of the market. i've done it.but if you have losing systems-you will lose money super fast

thanks for sharing.

how long did it take for your trading "business" to get established? 10 years?

 

[newwurldmn]

Quote from hanzahar:

if starting a business is less riskier then day trading... why people day trade? because people assume they have better chances of succeeding and it is easier? (low cost)

Yes.

Running a real business is really hard. Lots of different issues all the time.

Trading seems easy. Just click a few buttons.

 

[Scataphagos]

Quote from hanzahar:

if starting a business is less riskier then day trading... why people day trade? because people assume they have better chances of succeeding and it is easier? (low cost)

Both have a high failure rate.

Trading offers no barrier to entry, low operating costs, small capital to get started.

 

[blakpacman]

The safest thing is real estate, which is why banks will loan you 80% on the value of the property. If someone opened a trading account with $20,000 vs. someone who bought a $100,000 property with 20% down of $20,000, I would bet that after 10 years the person with the property will have the higher net worth, whereas the person who opened a trading account will have lost his $20,000 several times over.

 

[hanzahar]

Quote from blakpacman:

The safest thing is real estate, which is why banks will loan you 80% on the value of the property.

real estate success rate is higher then starting a business? lowest risk?

 

[blakpacman]

Quote from hanzahar:
real estate success rate is higher then starting a business? lowest risk?

If one enters real estate in the bubble period, then risk is high, but I think real estate is safer than business in general as a rule of thumb.
You can still mess up if you buy into a declining neighborhood, city imposing rent control, or commercial real estate vacancy where you only had one tenant.

 

[Bob111]

Quote from hanzahar:

thanks for sharing.

how long did it take for your trading "business" to get established? 10 years?

took me a while(few years). and it's a full time job for me(i mean-market hours+1 hour before open and at least 1 more hour after close(typically +2))but! nothing last forever. and so my systems. this year i'm up like 15K only.. due many factors,that not depend on me.you have to spend even more time,searching and adapting to changing conditions. bottom line-prepare yourself for a never ending journey,where results are unknown and unpredictable.
where you can spend years of coding,testing,coding again and will end up with nothing. i mean NOTHING AT ALL . and that would be a not a bad case,cause it's better than let say-100K loss. keep in mind-you can only deduct 3 K of your losses each year.

 

[ChinggChilla]

It's difficult to give a solid yes or no answer for this. There are too many variables to consider, for example certain types of businesses are riskier than others. Same goes for trading, the risk depends on your style and types of instruments you trade (i.e- trading futures may carry more risk).