"Real Winners Are Equity Traders"
- Thread starter Fundlord
- Start date
I just think 9/10 people that you said lose in Forex is because they plan to lose. Forex trading is a high leverage trading that is more like gambling for many people. They have no knowledge of how global economy is working and just open an account with $100 and double it in 10 minutes and then lose all in the next 10 minutes. If they were required to open an account with a minimum of 25K, they would risk less and lose less.
We can debate this all day, but without good data it's all conjecture. I don't know the exact odds, but retail traders have the odds stacked against them in FX, futures and stocks. FX may be the worst because of leverage, brokers and so many harebrained trading strategies (from both vendors and on forums). However, it's possible to profit in any of them. Honestly, a beginner with decent funding is better off finding a good trader/manager or automated system than learning on his own (though there are plenty of bad money managers and systems).
Just in the crudest sense, it makes sense that trading stocks on the long side would be a good gig over the long term. After all, equities represent real companies that invent new things and make real money, not just speculations about the direction of monetary flow or supplies of commodities. And although traders use short holding periods, the long term is made up of a bunch of short holding periods. So if the long term is bullish, the short term (on average) is also bullish.
if you walk into a casino you want to play the game with the best odds. not slots or baccarat. trading is the same way. equities have the best expectancy. not futures, shorting, forex, or options. it might not matter in the short run but it definitely will in the long run.
Anywhere in the world there are always winners and losers - it's called variance. Some people walked out of Vegas with millions. Should we now give up trading and turn to Roulette instead?
Let's just stop the guessing and story telling for a while and have a look at numbers. Real numbers. Sure, you *could* make a killing in forex. But if I look at systems & returns of 10.000 fellow traders and none of them was consistenly successful over the years, how likely is it that you succeed in forex trading?
For all those interested in forex. I've watched www.zulutrade.com over the years. 10.000 of registered systems/traders with live results. How many make money consistently over 3 years? A few.... and also they have drawdowns.
http://collective2.com/ offers a great comparison of live traders in equities, futures, forex and options. Different strategies (daytraders, swing traders, position traders) and many years of track records. Thousands of traders. Register and look up results yourself - it's free. These are my conclusions:
* Options and forex are the least successful. (Almost) nobody makes good and consistent money trading these.
* Futures are better, there are some successful traders but overall by far not as good as
* Equity traders. The very best category in C2. Most of consitantly proftable traders trade equities, and out of those (almost) all profitable traders are swing traders. Not really position, never daytrading.
So here's the official conclusion: The most solid strategy is swing-trading equities.
There should also be noted that altogether 20-30 traders are consistently profitable on collective2 - out of thousands. So really, trading isn't easy
Also interesting is that real hedge funds, who are thought to be professional, also have drawdowns and quite many of them fail. They are no way better than "amateur" traders like we are.
Let's just stop the guessing and story telling for a while and have a look at numbers. Real numbers. Sure, you *could* make a killing in forex. But if I look at systems & returns of 10.000 fellow traders and none of them was consistenly successful over the years, how likely is it that you succeed in forex trading?
For all those interested in forex. I've watched www.zulutrade.com over the years. 10.000 of registered systems/traders with live results. How many make money consistently over 3 years? A few.... and also they have drawdowns.
http://collective2.com/ offers a great comparison of live traders in equities, futures, forex and options. Different strategies (daytraders, swing traders, position traders) and many years of track records. Thousands of traders. Register and look up results yourself - it's free. These are my conclusions:
* Options and forex are the least successful. (Almost) nobody makes good and consistent money trading these.
* Futures are better, there are some successful traders but overall by far not as good as
* Equity traders. The very best category in C2. Most of consitantly proftable traders trade equities, and out of those (almost) all profitable traders are swing traders. Not really position, never daytrading.
So here's the official conclusion: The most solid strategy is swing-trading equities.
There should also be noted that altogether 20-30 traders are consistently profitable on collective2 - out of thousands. So really, trading isn't easy
Also interesting is that real hedge funds, who are thought to be professional, also have drawdowns and quite many of them fail. They are no way better than "amateur" traders like we are.
This sample set has issues as it's highly doubtful that the majority of equity traders on that site were logging their results prior to probably 2010. I mean pretend we took a similar sample back in 1998-2000 - it would show that equities were the absolute only way to go, fast forward 5 years and not so much. Now with 6+ years of the Federal Stock Market it's also going to bias the results to low volatility trading setups (which also affects options traders).
Convenient coming from someone with the name SwingToWin.
Last edited:
I don't buy it on the count of if you have a consistently profitable system why the hell would you sign up to a site simply to show case it? Most do so dreaming of selling a system. Currency has always had a good kicking in the public arena and I have never understood why, if you can scalp stocks you can scalp currency, if you can swing trade stocks you can swing trade currency, if you can trade on a macro level then its ideal...its good to become proficient in every area of the market allowing you to follow the action and avoid those dull boring periods that come around.
Why are there any hedge funds? Any investment corporations? Because you can leverage your knowledge by trading OPM.
Oh... no. Stocks and FX are different assets with different behaviours. I doubt you can use the same strategy for both classes without a lot of adaption. Besides, have you ever seen anybody scalping stocks or FX and making money at the end of the month? I haven't.
That is true. I believe that the utmost of traders prior to 2010 or even in your 1998-2000 just quit trading. Probably because they had lost too much. Not a good sign
Haha that's a good point! And valid. Indeed I only do swing trading.Convenient coming from someone with the name SwingToWin.
But I don't trade equities at all. I don't understand them, I can't predict them and my approach doesn't work well with them.
I don't feel ashamed to admit that all my research points in the way that the most profitable and consistent results come by trading equities, but I'm unable of trading them profitably.
No problem, that's life.
There're other assets left that work better for me, because I feel I can understand and predict them well enough.