Why do 95% of retail traders lose?

Most enter trading trying to get rich quick and either overtrade or bet too big.

The hard reality of grinding up a business from scratch, taking lower risk for lower returns to begin with while you are still learning, does not appeal to most people..
 
The main thing I got from this thread is to pay attention to what newbies do so one can take advantage of their mistakes. Essentially, don't play the chart, play the men who are trading the chart.
 
Quote from jlancaster:

The main thing I got from this thread is to pay attention to what newbies do so one can take advantage of their mistakes. Essentially, don't play the chart, play the men who are trading the chart.
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Nothing new about this approach, this already been expploited by big firm long long time ago ..
 
Quote from galvinlee888:



The true to win in the trading is that you have to be patience and take LONGER time frame. The rule of thumb is that if your trading cost (commission, slippage, data feeding cost and etc) are more than 1.5% of your overall profit, you chance to survice in long term are pretty slim, none of the edge can compensate more than 5% of the cost.
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I agree ,

Trading YM at 5 dollars per tick and around a 650 dollar Daily ATR paying $4.50 a contract.

Say you make 20% of the ATR $130 ... Then its 3% cost per trade you put on to make 20% of ATR

YM and NQ cut into your profits by a good percentage.

Better off trading oil , tf ect .or something with higher tick value and daily range. Things with smaller daily range and tick value should be traded on longer timeframes.
 
Beyond all the things that have been mentioned previously in the thread... the elephant in the room is that some folks find out it's actually "work"

I can't tell you how many times folks have come to my monthly investing/trading club and they don't even want to take the time to read a book or study a stock before jumping in (watching its movement- getting a feel for normal volume and ATR etc). They just want me to "tell them how to make money."

I once did a lesson plan on how I select a trade, measure my risk, set my stops & price targets, etc. and a guy in the back of the room raised his hand and said "that's great, but can't you just email us the answers?"

IMHO, if they don't have the time to read a good technical analysis book... they don't have the time/ patience to be a good trader either.

I think the ease of entry (deposit money into an account and call yourself a trader) skews the population of who are labeled "traders" - maybe they should start the statistics of who is a "trader" after a year. Get the wannabe's out of the data.
 
In the gold rush, the people who made money sold shovels and spades. In the trading gold rush, people who write books and offer counseling make money, traders don’t. This sums it up.


From 1897 to 1900, 200,000 people started to the Klondike and only 30,000 reached it (1 in 6). Not more than 400 found any gold (1 in 500) and of those only a few managed to keep it (possibly 1 in 5000). It is said that if all the gold that was found (some 4 millions dollars) was divided among everyone that first started the search, each would receive $20.00!


How long does it take? This is the question most frequently asked. The answer is: in my experience, it takes 10 years and 10-20,000 hours of practice before the average person gains enough expertise to succeed consistently in the trading shark tank.

http://www.marketoracle.co.uk/Article533.html
 
You don't seem to understand something....most HAVE to lose in order to greatly reward those who do succeed. It's the way the game is structured, get with the program! :)


Quote from emg:

Here is another interesting article traders are losing!

http://www.suntimes.com/lifestyles/...-workers-hold-weekly-bible-study-classes.html

Remember small traders! Think real real hard if you really want to lose.

More than 90% of small traders lose in a "Spectacular Fashion." They just lose!!
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Quote from Fireplace:

You don't seem to understand something....most HAVE to lose in order to greatly reward those who do succeed. It's the way the game is structured, get with the program! :)
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Only 1 in 100 will make it in this game. With that numbers in mind, small traders should not trade at all
 
I've done other difficult things. Learning Electrical Engineering is a very difficult thing, it's more difficult when you are exceptionally thorough and really want to master the subject... in that arena there were plenty of educators that were willing to share every last thing they knew about the subject... trading is much easier in the technical area but the other side of the coin is that almost nobody shares anything at all worth knowing about the subject...
 
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