What is a trader?

OK, but what does a trader get paid for? Who gives him/her the money and why? A bank for example is an intermediary between borrowers and lenders. But let's say a hedge fund makes a 100 million in profits, what service did it provide for that money? In other words, what is it that the majority of market players can't do themselves, so they have to pay the minority of winning traders and hedge funds to do for them?
 
paid for investing their time and limited capital in the trade.

Quote from neutrino:

OK, but what does a trader get paid for? Who gives him/her the money and why? A bank for example is an intermediary between borrowers and lenders. But let's say a hedge fund makes a 100 million in profits, what service did it provide for that money? In other words, what is it that the majority of market players can't do themselves, so they have to pay the minority of winning traders and hedge funds to do for them?
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Quote from stock_trad3r:

also add:

traders tend to lose more money than they make
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So what you're saying is that traders are failures.

It's all so clear to me now. Now I know why you selected that user name. :D
 
Quote from neutrino:

OK, but what does a trader get paid for? Who gives him/her the money and why? A bank for example is an intermediary between borrowers and lenders. But let's say a hedge fund makes a 100 million in profits, what service did it provide for that money? In other words, what is it that the majority of market players can't do themselves, so they have to pay the minority of winning traders and hedge funds to do for them?
More...

Sorry if I ruin the thread, lindq, but I found an answer to my question and I want to post it. I've been trying to find an answer to this question for years...

Since traders, hedge funds, active mutual funds etc. do not create any value, it follows that the winning ones simply steal it from the losers. The whole industry (except for index funds) is like a giant poker table or a roulette table - it's a zero sum game and no value is created. So we are not getting paid for anything, some of us are just good enough to steal it.

So if someone asks me - what do you do for a living, what service do you provide - I will answer, that I do not create anything, I just steal from others on the principle that if someone is not smart enough to hold onto his money, he does not deserve to have it :cool: Fortunately, it is not a crime and it's legal :confused:
 
the market is for investors who want to buy or sell stocks.

the commodity markets is for producers to sell products and buyers to buy products.

traders(market participants) market makers buy and sell all the above to keep the market liquid.


Quote from neutrino:

Sorry if I ruin the thread, lindq, but I found an answer to my question and I want to post it. I've been trying to find an answer to this question for years...

Since traders, hedge funds, active mutual funds etc. do not create any value, it follows that the winning ones simply steal it from the losers. The whole industry (except for index funds) is like a giant poker table or a roulette table - it's a zero sum game and no value is created. So we are not getting paid for anything, some of us are just good enough to steal it.

So if someone asks me - what do you do for a living, what service do you provide - I will answer, that I do not create anything, I just steal from others on the principle that if someone is not smart enough to hold onto his money, he does not deserve to have it :cool:
More...
 
all this trading buying and selling activity creates a closing price to investors or consumers at the end of day

traders make profit from spread ask and bid
brokers make money on fees.

the market is not game or casino but a serious and important intitution.

the failure of the market can cause problems in the real economy.


Quote from neutrino:

Sorry if I ruin the thread, lindq, but I found an answer to my question and I want to post it. I've been trying to find an answer to this question for years...

Since traders, hedge funds, active mutual funds etc. do not create any value, it follows that the winning ones simply steal it from the losers. The whole industry (except for index funds) is like a giant poker table or a roulette table - it's a zero sum game and no value is created. So we are not getting paid for anything, some of us are just good enough to steal it.

So if someone asks me - what do you do for a living, what service do you provide - I will answer, that I do not create anything, I just steal from others on the principle that if someone is not smart enough to hold onto his money, he does not deserve to have it :cool: Fortunately, it is not a crime and it's legal :confused:
More...
 
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