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95% failure rate?

  • #21
  • Oct 29, 2008 6:10pm Oct 29, 2008 6:10pm
Those are some of the best answers I have found anywhere. Thanks again your posts are all eye opening.

All said being true wouldn’t the “95%” ratio also apply to “System” and “EA” failure as well?
  • #22
  • Oct 29, 2008 6:21pm Oct 29, 2008 6:21pm
Quoting jdcompute
I could not have said that any better Kudzu! I hate hearing 95%..blah blah blah. 95% based on what? a survey of 10 traders in a room? Does that small sampling represent the entire trading population in the U.S.? in the U.K? in the entire world? hardly believable.
The "myth" of a 95% failure rate goes back to an article a few years ago. They asked the head of FXCM the following question: "How many of your customers make a profit?" His answer was something like: "I would be surprised if it was 5%".

Here's a quick way to find out....how many here ARE profitable?

Oh, and how many of you are lying about it? The sad truth is this: It doesn't matter how many succeed, just that I DO.
  • #23
  • Oct 29, 2008 7:32pm Oct 29, 2008 7:32pm
Quoting G33maroon
birdt,
in my language, there is a saying \\"the back of a parang if polish it can be sharpen\\".
We have a saying in my language..."You can't polish a turd"
  • #24
  • Oct 29, 2008 8:01pm Oct 29, 2008 8:01pm
I was watching a video at PFX Global last week; I think it was one of Wade's but I'm not sure now. Anyway, he mentioned that the 90-95% statistic comes from surveys of various retail FOREX brokers that appear from time to time in some industry trade magazines. It may actually have been Currency Trader Magazine, but I don't remember.
  • #25
  • Oct 29, 2008 8:07pm Oct 29, 2008 8:07pm
Quoting G33maroon
why you generalise that 50% is below average intelligence?
Because by definition 50% is always below the mean and 50% is above the mean?
.
  • #26
  • Oct 29, 2008 8:19pm Oct 29, 2008 8:19pm
Quoting willf
We have a saying in my language...\"You can't polish a turd\"
I try to disagree but you win. I spent few minutes searching the net for something that saying we can polish a turd. Anyway, all i found...

This is from urban dictionary, "She tried to look more attractive by getting plastic surgery, but let's face it, you can't polish a turd".

but hehe, so i got what you mean.
I am bored..
  • #27
  • Oct 29, 2008 11:05pm Oct 29, 2008 11:05pm
Here's the deal guys:

95%
5%
20%
80%
2.37895%

so what?

if the actual figure of those who succeed was 1% I'd still do it as I am

because...

winners win
and...
(you know how the rest goes)
  • #28
  • Oct 29, 2008 11:31pm Oct 29, 2008 11:31pm


"The only good luck many
great men ever had was being born with
the ability and determination to
overcome bad luck."

Channing Polluck





.

  • #29
  • Oct 29, 2008 11:34pm Oct 29, 2008 11:34pm


"Opportunity is missed by
most people because it is dressed in
overalls and looks like work."

Thomas Edison





.

  • #30
  • Oct 30, 2008 1:50am Oct 30, 2008 1:50am
OK........the 95% rule goes like this. Upon first deposit 95% of home traders lose. The traders in the world that work for firms are mostly break even losers or make less than 15% annually because they are to lazy; part of the 5% winners. Those of us that play in the highly leveraged OTC derivatives market which are a success try to beat the 15% annual guys or beat the real rate of inflation by 2 times (20%). A good trader does 30% annually. Which is also part of the 0.0005%.

Good Luck conquering yourself .

I usually don't say how much I make but since coming back to work in September the fund I manage is up 31.8%. It's only praise if you do something useful with the money and even then its never enough. Money is just debt and debt is money. Its a means to a beginning, not an end.
  • #31
  • Edited 4:56am Oct 30, 2008 2:55am | Edited 4:56am
i admit myself is also in 95% category when it was almost 2 years ago.. now i have something solid. my journey is pretty rough to what i have learn today,

but probably most of the people would give up once they failed once or twice. just never give up will usually get your there..

Trading is Serious Business :-)
  • #32
  • Oct 30, 2008 10:35am Oct 30, 2008 10:35am
Quoting hfTrader
Because by definition 50% is always below the mean and 50% is above the mean?
you're correct. but shouldn't a normal distribution have a mean of zero and a variance of one. although..maybe..some you can consider as standard error.

G33maroon
I am bored..
  • #33
  • Oct 30, 2008 4:54pm Oct 30, 2008 4:54pm
Based on a sample of one broker, a senior trader there told me it was around 80% of their client base consistently lost money.

Of that remaining 20%, many of them simply break even.

And out of their client base (in the tens of thousands, so not that big), they only followed a handful (less than 10) clients.

No real surprises I guess.
  • #34
  • Oct 30, 2008 5:49pm Oct 30, 2008 5:49pm
If to talk about professions, than you can't generalize university educations. It's more of some kind of a ZEN, not the scores of exams. Generaly good results achieve those, which get satisfaction of their professions without needing being paid. The same rule applies to forex too!

Looking back at my years of studying economics and facing current trading results, reveals me the pitfalls of the educational system. It only creates dumb professionals - theoreticians. If only you want to, you can put an effort and free yourself.

Trading is facing your own beliefs, it's what this system is all about. I think I passed a lot of stages now, but feel like it's only the begining of a journey and I already spent 5 years studying and just preparing for it!

I expect the journey to last a life time, and knowing I am stil young, I take my time to overcome this 95% barrier.

Peace.
  • #35
  • Oct 30, 2008 8:37pm Oct 30, 2008 8:37pm
here is a quote from Todd Crosland, president of InterbankFX

"In the tracking that we do with our customers, we have found that 49% of our standard accounts have been profitable over the last 24 months."

link
http://www.mabico.com/en/news/200710.../article90826/

does it really matter to you whether the success rate is 50% or 5%?

Either way percentages do not matter much if you end up being successful - consistently
  • #36
  • Oct 30, 2008 9:08pm Oct 30, 2008 9:08pm
guys the game is much more simplier! human = greed and that wont work here, before its a technical or fundamental factors, its a money management factor, if i were to make 7 bad trades per 10 traders where i lose only 30 pip in those 7 trades and win 75 pip in those 3 trades, i'll be making money!

we "traders" are the ones who move the market, 95% of traders are the real movers of the market, not the left 5%, but its just a MONEY MANAGEMENT!!

hope that helps
I recommend you read something else as this sentence is now concluded.
  • #37
  • Oct 30, 2008 9:21pm Oct 30, 2008 9:21pm
Quoting Obaidah
guys the game is much more simplier! human = greed and that wont work here, before its a technical or fundamental factors, its a money management factor, if i were to make 7 bad trades per 10 traders where i lose only 30 pip in those 7 trades and win 75 pip in those 3 trades, i'll be making money!

we \"traders\" are the ones who move the market, 95% of traders are the real movers of the market, not the left 5%, but its just a MONEY MANAGEMENT!!

hope that helps
Sorry, not a chance in hell that the 95% that loose are the movers of the market. The long time winners have more capital and theirfore influence the market more. What your saying is that a trend exists because a bunch of loosers got the direction wrong? mmh.

Please dont talk asif you know what your saying, that was a stupid comment.
I dont know much, but I know by only utilising a little common sence that your post is garbage, sir.

Leon
Living the adventure in my head.
  • #38
  • Oct 30, 2008 10:57pm Oct 30, 2008 10:57pm
In a zero sum game where skill is required, eventually the entire sum will accumulate in the hands of few.

The term "Trading" is a continuous tense. That means putting a trade with TP and SL is not enough each and every moment in the given timeframe has to be managed. Unfortunately very few knows how that is done in a systematic way.

There is nothing easier in life than trading currencies. Unfortunately, it takes time to realize the easy part.
  • #39
  • Oct 31, 2008 12:15am Oct 31, 2008 12:15am
Quoting im7i4z
In a zero sum game where skill is required, eventually the entire sum will accumulate in the hands of few.

The term \"Trading\" is a continuous tense. That means putting a trade with TP and SL is not enough each and every moment in the given timeframe has to be managed. Unfortunately very few knows how that is done in a systematic way.

There is nothing easier in life than trading currencies. Unfortunately, it takes time to realize the easy part.
Nothing easier? Overstatement maby?
Living the adventure in my head.
  • #40
  • Oct 31, 2008 12:42am Oct 31, 2008 12:42am
There have been a few actual studies released over the years that confirmed the 80-95% failure rate. I believe the most recent was done by an accounting firm analyzing the tax returns of all of their trader clients. Alas, I don't have the link handy (I've posted it before, so if you search long enough, it should come up).

It should also be noted that over the summer, the Chinese gov't banned retail forex trading. Their reason for doing so was b/c in their own analysis of the Chinese forex retail venues, they found that >80% of clients were net losers. Thus, in the best interests of the public, they defined it as gambling and outlawed forex trading. Interesting to say the least. Here's the info:

"Eighty to 90 percent of players in foreign exchange margin trading had lost money, though banks providing the service were generally making a profit from it, the banking regulator said."

http://in.reuters.com/article/asiaCo...33998520080612
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