Why do 5% of Traders Win?

Small Traders think that they are somehow special and won't be like those 95% losers.

Small Traders believe they are smarter and faster than the other 95% losers or that they have some system that will make them rich.


Higher Education is the key to become a successful traders

http://www.elitetrader.com/vb/showthread.php?s=&threadid=236628



Higher Education is the Holy Grail!

Quote from emg:

It's not psychological problem small traders are losing. The reason they are losing are:


1) Under Capitalized
2) Low Educated


For example, this person must be extreme lower educated to trade in the futures market with a starting capital $5000



The minimum capital to trade in the futures market is $500K. If you don't have that kind of money, work in the "House"


More than 90% of small traders lose! They just lose!!

Reload that account until u are dead broke. RELOAD
More...
 
Here is an interesting article:

http://www.800gambler.org/ArticleDetails.aspx?ContentID=18


Gambling in the Stock Market Stock Market Gambling


- October 19, 1987 will be remembered by most people as Black -Monday-the day that the Dow plunged 508 points. We at the Council will remember it as the day the securities gambler came of age.
Prior to October 19, 1987 calls for help from stock market investors who crossed over the line to compulsive gambling represented 2% of our statewide Helpline 1-800-GAMBLER© calls for help.
In the weeks that followed, stock market gambling calls represented 44% of all hotline calls.
 
Where do these sick, obsessed fools like EMG and GrandSuperCycle come from?

EMG, your own psychosis is a primary reason why so many traders fail; you keep doing the same thing, and never learn.
 
NoDoji don't mean to get you wound up. But I'll try to add my insights and answer your questions.

>I can't think of a single good reason for me personally to enter a >trading contest or to document my abilities.

The main reason to do this is that there is huge money and opportunity for the winners, prestige, ability to prove you did it. Even, if you personally are not interested in any of that -- many people are and its possible to see their results. Obviously, it varies year to year but 50% to 300% returns offer the chance of winning. Let me repeat, there is big money for the winners. I would enter if i could get the capital.

>>What is your area of expertise, by the way? You track traders >>professionally? Do you have a study or white paper available with >>the statistical results of all this tracking?

Well, first I've been able to predict/forecast the market in advance. I've never met anyone with that ability. But, also, I have 2 of the top ranked futures systems at C2 over the longest period of time (out of thousands). Again, it doesn't matter if you think C2 is silly, the point is that thousands of people try this and couldn't do better. So, over the years I've monitored the futures traders. I'd say most systems I've watched and traders have "broken" down. I, also, know word cup winners and what they are capable of.

I was also good friends (at one time) with Dr. Steenbarger. He now works at a prestigious hedge fund. He was a fixture of the futures community for many years. He wrote on his blog that he had never met a small retail trader who traded for a living: never ever had he seen such ability documented. You'd think if anyone would know then he would know.

Also, I met with the manager of a proprietary trading firm -- one of the biggest/best at one time -- a real firm that provides firm capital and doesn't sell trading. He's been in the business for a long time. I was told that he had never met a first year trader to do more then 40k-45k. Of course, you get unlimited buying power if you're successful and they have traders making millions. I estimate they start you off at about the equivalent of a 15k-30k notional account. Notice how this matches nicely with the 3x top returns. If its so easy for someone to do 90k from 10k then you'd think a firm that has millions invested could get their traders to do as good or better within a year..

But... wait there's more. There are published results from CTA's, hedge funds, etc. If you take the long term 5 year to 10 year results from money managers then Sharpe ratios drop to below 1. In other words, the best managers over the long run only do around 1:1 risk/reward.

Obviously.. I have my records and anyone can see what I've did. I know for sure that if I could get into World Cup then I would (I will enter if anyone funds me and PM ME)..
 
Lucias I have been a proprietary trader, and this statement is correct:" I was told that he had never met a first year trader to do more then 40k-45k."

However, a first year trader starts with only 10,000 of capital and $50 daily stop loss. They are also trading stocks without any leverage, only the capital provided. Most traders make 0 money on average over the first 3 months. Which means that in the next 9 months they need to earn that 40K on capital which ranges between 10,000 and 50,000. Let's split the difference and say $30,000. But it gets better, on average they only get to keep 70% of what they earn. This means that they need to generate $65000 in 9 months to earn that 40K. That's a 200% return on $30000 earned in only 9 months. Unleveraged!

Now, what can you do with $10,000 leveraged even 5:1 ( in Canada I can leverage my gold purchases as much as 400:1; you're limited to 50:1 in the USA), with a few years of successful experience ?? :D
 
You are wrong on all of this. I won't disclose specific but I was going to be given around $1500 risk limit per day. That's starting and for anyone who is accepted. Now, you take a 50% split of that and that leaves about $750. You take $750/.05 = $15,000.... But they ramp you up quickly too... so by the end of the year it would be a lot more. probably 2k-3k. Therefore I'm providing rough estimates.. anywhere from 15k-50k equivalent notional account.. This doesn't mention whatever edges they have, i.e that a retailer wouldn't have.


Quote from bhardy307:

Lucias I have been a proprietary trader, and this statement is correct:" I was told that he had never met a first year trader to do more then 40k-45k."

However, a first year trader starts with only 10,000 of capital and $50 daily stop loss. They are also trading stocks without any leverage, only the capital provided. Most traders make 0 money on average over the first 3 months. Which means that in the next 9 months they need to earn that 40K on capital which ranges between 10,000 and 50,000. Let's split the difference and say $30,000. But it gets better, on average they only get to keep 70% of what they earn. This means that they need to generate $65000 in 9 months to earn that 40K. That's a 200% return on $30000 earned in only 9 months. Unleveraged!

Now, what can you do with $10,000 leveraged even 5:1 ( in Canada I can leverage my gold purchases as much as 400:1; you're limited to 50:1 in the USA), with a few years of successful experience ?? :D
More...
 
Quote from Lucias:

You are wrong on all of this. I won't disclose specific but I was going to be given around $1500 risk limit per day. That's starting and for anyone who is accepted. Now, you take a 50% split of that and that leaves about $750. You take $750/.05 = $15,000.... But they ramp you up quickly too... so by the end of the year it would be a lot more. probably 2k-3k. Therefore I'm providing rough estimates.. anywhere from 15k-50k equivalent notional account.. This doesn't mention whatever edges they have, i.e that a retailer wouldn't have.
More...

"Going to be given"? Unless you've actually done it ( as I have ), your numbers don't mean very much. What you're describing is far from standard for a new trader with less than a year of experience.

Well, first I've been able to predict/forecast the market in advance. I've never met anyone with that ability. But, also, I have 2 of the top ranked futures systems at C2 over the longest period of time (out of thousands). Again, it doesn't matter if you think C2 is silly, the point is that thousands of people try this and couldn't do better. So, over the years I've monitored the futures traders. I'd say most systems I've watched and traders have "broken" down. I, also, know word cup winners and what they are capable of.

If a person is successful and making lots of money, why are they wasting their time trying to prove it to the whole world?
 
"If its so easy for someone to do 90k from 10k then you'd think a firm that has millions invested could get their traders to do as good or better within a year."

It isn't easy. 95% of traders fail.

So, do the math. .05 (90,000) + .95(-4,000) = $700. This is the average return of an actively traded investment of $10,000. I say -$4000, because a person would be fired before they lost more ( on average). I am manufaturing numbers, but you see my point, don't you?
 
bhardy.. I was given the opportunity and this is not unusual for real prop firms. I"m not talking about the bucket shops like Swift or Title Trading. I did not accept it because I make more per year then I could starting and he believed I should have 1 year of savings. It just didn't make sense. I've let a lot of people here show how stupid they were by making false statements that I knew to be false. I haven't taken the effort to point out those people (not you in particular but others).

You are wrong again too.. you will not get be losing everyday. They will shut you down.

>>If a person is successful and making lots of money, why are they >>wasting their time trying to prove it to the whole world?

Because it takes money to make money.. I AM one of the best at what I do which is trading the zero sum futures game, predicting the market in advance, etc. I claim a comparative "best" but not an ABSOLUTE best. I know there are traders, running HFT systems that smoke anything I could do but again I don't compare myself against them.

Many people who have discovered a truth and found the world not to believe them end up going crazy/mad/etc. I am beyond and above that. And I don't care what most people think but I am very disappointed in Dr. Steenbarger because he should have recognized my ability and yet discouraged me.

I can do 50%, 100%, 200%, 300%. I do not know if I can do more but you do the math 6k * 100% = 6k/12 months = $500/month /4 weeks = $125 week. There are Forex martingale systems right now running at C2 making their owners 15k per month.

I WANT to trade but I also recognize it takes money to make money. No you don't need 500k to trade 1 es contract and NO you will not make 90k per year trading on a 10k account. Am I the only one who actually has studied the market here?

Also... to NoDoji, again you may claim "but I don't see no reason to show my record". That's fine.. I can buy that. I can buy that but can I buy that there are no scalpers in the futures market willing to show their records? Can I buy that NO scalper making 90k per year wouldn't want to make the 500k-600k that could come from winning a World Cup? Can I buy? And can I buy that this has never happened in history? Can I buy that I'm one of the ONLY vendors who shows a record that is 3rd party? (Even if it is hypothetical).

I met some traders who had taken a vendors course. Told me they were making couple K per day scalping. I told him that I'd pay him or any of his friends for a record and I'd pay for training. Not one replied!! I do offer training because my record shows that I am among the best at least OF THOSE WHO HAVE RECORDS.

Maybe you're able to do it... it is true that all the people who've did this have claimed to trade 6e and crude. So, you might be on to something.. but even so, my logic stands.

Quote from bhardy307:

"Going to be given"? Unless you've actually done it ( as I have ), your numbers don't mean very much. What you're describing is far from standard for a new trader with less than a year of experience.

Well, first I've been able to predict/forecast the market in advance. I've never met anyone with that ability. But, also, I have 2 of the top ranked futures systems at C2 over the longest period of time (out of thousands). Again, it doesn't matter if you think C2 is silly, the point is that thousands of people try this and couldn't do better. So, over the years I've monitored the futures traders. I'd say most systems I've watched and traders have "broken" down. I, also, know word cup winners and what they are capable of.

If a person is successful and making lots of money, why are they wasting their time trying to prove it to the whole world?
More...
 
Lucias, with all due respect, you're trading a SIM account. I am aware of your diary. I follow it from time to time. Get busy with some real money and show yourself what you can REALLY do.

I've always traded with real money with the exception of a brief half day with a SWIFT copycat.

Also, I don't understand the appeal of these world cups. I just want grab a few million over the next 15 years and go disappear and take care of wife and child, recover my skills on my violin so I can play with my wife who is a professional violinist.

I trade because I enjoy trading, not because I want to be some super famous individual.
 
You must log in or register to reply here.
Back
Top