Reading this, I can see that you don't want it enough and that there is a high probability that you still won't be making any money in 10 years. You have the patience, but I am afraid you don't want it enough for you to survive. You expect someone to give it to you on a silver platter and I am sure that you are in it for the "easy" money.
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Trading is a Giant Scam!
- Thread starter Bullz n Bearz
- Start date
Reading this, I can see that you don't want it enough and that there is a high probability that you still won't be making any money in 10 years. You have the patience, but I am afraid you don't want it enough for you to survive. You expect someone to give it to you on a silver platter and I am sure that you are in it for the "easy" money.
Quote from Bullz n Bearz:
Guys, I have to be honest here. I don't think trading is a lucrative business and here is why most people lose at trading.
The markets ARE very random and they cannot be predicted. Nobody knows who is buying what and when so you are working off what data is given to you.
I can tell you so many people on ET have probably lost their entire savings trying to make big money in the markets to only soon find all their money given back. Sad it is, but that is the nature of the markets.
Spydertrader makes you think he knows what he's talking about, but he himself and old man Hershey cannot guarantee you the success like they like to make you try and think.
So, for anyone that is new in the markets, I would just suggest give it up and try something else like working a regular 9-5 job. They are 9-5 fixed income for a reason. Stability.
Markets =unstable
Nobody can win the markets. Nobody
What you have discovered is that it is difficult to make money but that doesn't mean it is a scam or impossible. As with everything else it takes time, knowledge, practice, money etc.... If it was impossible Renaissance would not have been able to generate the returns they have over the last 15+ years using purely quantitative analysis.
It is true that markets are relatively efficient in most cases extremely so. It is true that you can't predict the future with 100% certainty. However, temporary price discrepancies between assets do occur as do discrepancies between risk and price. What you can do is identify if the price of your prediction compares favourably with its probability of happening. Any differentials create opportunity such that infinite iterations of a certain strategy will give a probability of success or failure very close to something absolute. This is ultimately about risk management and is no different to the way actuarial science works in the insurance business.
Of course the winners win at the expense of the losers. The additional risk in stocks is priced over the long run versus bonds and cash etc... Everything carries its own risk which is usually but not always priced efficiently.
The big players close pricing opportunities very quickly so it is tough as an independent to find inefficiencies that can be exploited quickly enough and profitably enough to make it worthwhile. However, certain markets still have more significant inefficiencies that can be exploited especially if you have knowledge of that market or the sector it represents.
Ultimately you need to be able to calculate your alpha and understand the risk profile of your trades in order to make money. Remember, if it was easy everyone would be doing it and at the same time noone would be doing it because the inefficiencies would be closed before anyone could trade them!