Why do 5% of Traders Win?

[futurecurrents]

I hope it's because the market's a casino and I'm a card counter. I have perfect execution and discipline. (automation helps...is there an echo in here?) And like a casino, over a large number of trades the odds have to go in my favor.

But maybe you should talk to me again in a year or so when I can say with more assuredness that I am a penta-percenter.

 

[baro-san]

Quote from oldtime:

everybody seems to be an expert on why 95% of trader lose. Just wondering if there are any experts out there on why 5% of traders win.

They do the opposite.

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[Handle123]

Quote from oldtime:
too bad they make me bet on the market and don't let me bet on traders

I developed one method that loses 11% of the trades, AND I designed it to bet against the other traders. I call it "SR" and no it is not Support/Resistance, it is called "Screwed Retail", I have found a couple patterns of when the retail trader throws up their hands and finally gets out and I take the other side of their trade. I back/forward tested it over fifteen years of data. I do not cause them to originally take the trade, but provide a service allowing them to get out. It happens from 0-6 times a day in ES.

Quote from deaddog:
In reality that plan is a little too simple but a well thought out plan, with entry and exit criteria, risk control and money management strategies, is what separates the 5% from the 95%.

Oldtime makes light of it but I would guess that 95% of the 5% have a trading plan that they consistently follow.

I always have three computers running in my office doing backtests of patterns that look interesting, but mainly for exits and seldom for entries. You still have to work hard at trading, especially in the beginning, cause you have to learn how to code to be able to backtest and have some conviction of what you are doing is going to work and not just over a couple years of recent data.

I think people are just too greedy, they want it yesterday, and seldom satisfied of making even one tic on a day trade. Forty % of my trades are one tic on original entry, and yeah, I miss out on some profitable trades that reverse if I hadn't of taken the one tic, but so many more where complete losses are avoided.

Quote from deaddog:
Because human nature doesn't change.

That is so right, the inexperienced, the lazy, the dreamer, the guy who just opened his first account, the undisciplined, the emotional, they all have the same things in common, lack of a fully tested trading plan. If your subconsious has faith in your trading plan, you are just there to hit buttons, it is the same video game all hour long, day, week, month.....

I am mentoring someone now, we were on the phone other day when a signal happens, we both get long, Price starts going down, at every tic down, I am adding same amount of contracts, after price gone down two points, I hear him several times keep asking if we should just get out instead of being stopped out, he is asking a ton of questions of "what if", I just keep adding more contracts, his brain is SCREAMING "Get Out, Get Out", he knows the rules are firm, but the pain is emotionally hurting his brain, I calmly told him price most likely will get withn 1-2 tics of the stop and reverse, and cause of Time rule, our new target will be one tic, twenty minutes later, we got our one tic profit. He was totally exhausted, but I was proud of him of hanging in there. THAT is what trading is all about, overcoming that internal emotional feelings and working your rules.... he was almost begging to end the trade so his brain would stop hurting him, but he knows the rules.

 

[krittika]

Hi Handle,

Want to ask you,what you base your scaling in tactic on?Volatility,volume,position size...etc?If you don`t mind.

 

[ElectricSavant]

http://www.elitetrader.com/vb/showthread.php?s=&threadid=47844

Quote from oldtime:

everybody seems to be an expert on why 95% of trader lose. Just wondering if there are any experts out there on why 5% of traders win.

 

[cornix]

I think Taleb was right about scalable professions (and trading is very scalable) as being extremely hard to succeed in.

And if consider how many of 100% treat trading seriously, as a real business, not as a kind of get rich quick game, 5% sounds like way too much.

 

[HATEtheRisk]

Quote from oldtime:

your English is getting pretty good. I should learn a foriegn language. How do you say "fuck" in German. At least that would be a start for me.

I am so sorry, my english is so horrible, i know.

My spanish is even worse.

But at least i can have normal conversation in both languages and understand almost everything and can say what i want.

fuck in german is: scheisse.
damn is: verdammt.
damn fuck is: verdammte scheisse.....

I will start a german class here on ET soon, you are welcome to be my first student....

 

[HATEtheRisk]

Quote from oilfxpro:

The difference between losers and winners is :

losers run one system or one or two set ups and systems.

winners run multiple systems and set ups.

So if one or few systems/set ups don't work ,it don't matter .....as long as others make money.

Their drawers are coming off faster than a whore's , and they are willing to change sides and join the winning side faster than a whore's drawers can come off.

Whores don't ged drawdowns ,they give them.

Ged It .

HAHAHAHHAHAHAHHHAHAHAHHA

very good

 

[HATEtheRisk]

Quote from ammo:

i would bet that 95% of those 5% rarely trade just sit and wait for setups

yeah.....

its not the strategy what makes the money, but its the sitting...

Got it ?

God damn sitting......

Means to hold on the trade, when you have to and allow it to reach their natural full potential......

Worst mistake of proffessional traders is to take profits too early....

@oldtime

you are hopeless lost, with your spreading methodology.
I dont see any hope for you, as long you dont chage your mindset.

 

[HATEtheRisk]

Quote from HATEtheRisk:

yeah.....

its not the strategy what makes the money, but its the sitting...

Got it ?

God damn sitting......

Means to hold on the trade, when you have to and allow it to reach their natural full potential......

Worst mistake of proffessional traders is to take profits too early....

@oldtime

you are hopeless lost, with your spreading methodology.
I dont see any hope for you, as long you dont chage your mindset.

We 5%, wait for our opportunity.

If there is no opportunity, we dont care, the next will come soon, or not.

There is no reason to risk money, in a scenario, where you are not 100% sure you will make money, exactly as how you think price will go...........

BUT, WHEN...............

we finally found a setup to trade,.........BOOOOOOOOMMM

we buy the shit out of the market and trade really big size, to make a fucking good bunch of money.

Because this is the reward for all that waiting and being patient.

We are hunters.

------------
If you have the time, go and watch a cat hunting.
Watch how long the cat just sits there and watchs the mouse hole, and finally after 5 hours sitting, the mouse comes out and is dead meat.
Then the cat goes to their shelter, eats the mouse and take a good nap.
-----------
To trade like the 5%, you must become a CAT.

Forget about cheetas, CATS are the true spirit animal of a Master Trader. We are dangerous hunters, but we look like cute animals........

Work of a 5% trader in %:

70% of time, we watch markets and watch for setups to build them up.....
20% of time, we watch our trades, tick by tick, reading the tape......
5% of time, we make the deals, buying and selling, managing orders......
5% of time, we do research and training on strategies and mental training

!!! Also, 90% of all possible setups we could trade, we miss !!!

KILL THE MOUSE
**meaow**