Why 95% Of All Traders Fail | Page 2 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Why 98% Of All Day-traders Fail 62 replies

Why most 'traders' fail 12 replies

Why do 99% of the people who wants to be traders fail? 182 replies

The Reason why 95% Traders fail 341 replies

Why Traders fail despite of good system available here in Forum?? 8 replies

Attachments: Why 95% Of All Traders Fail
Exit Attachments

Why 95% Of All Traders Fail

  • #21
  • Sep 4, 2008 8:22pm Sep 4, 2008 8:22pm
Quoting harigp
I use to hear the term stop loss hunting by the broker, if he does that
is that not illegal.
That needs to be discussed on a different thread. This thread is focusing on why 95% of traders fail and trying to get us out of that 95% by discussing different ways of becoming better traders but thainks for your response.

Pierre (RedRobin)
  • #22
  • Sep 5, 2008 6:23am Sep 5, 2008 6:23am
I assume that the 95% figure (or whatever it is) is the result of studying broker's client account records.

Well, obviously, nobody quits while they're ahead. Therefore broker records will inevitably show that virtually all those who closed their accounts did so with a negative balance.

David
  • #23
  • Sep 5, 2008 6:43am Sep 5, 2008 6:43am
From an article by trading psychologist and author Dr Brett Steenbarger......

"The main cause of trading failure is a lack of an objective edge in the marketplace, trading random patterns that have never been tested out for success."

Thanks to Ubeee, who pointed me to the link to the article.
The whole article is a very worthwhile read, IMHO.

There are also plenty more ideas in this thread.
The topic "Why do X% of traders fail?" has already been discussed many times on the FF forum.

David
  • #24
  • Sep 5, 2008 8:25pm Sep 5, 2008 8:25pm
Quoting hanover
From an article by trading psychologist and author Dr Brett Steenbarger......

"The main cause of trading failure is a lack of an objective edge in the marketplace, trading random patterns that have never been tested out for success."

Thanks to Ubeee, who pointed me to the link to the article.
The whole article is a very worthwhile read, IMHO.

There are also plenty more ideas in this thread.
The topic "Why do X% of traders fail?" has already been discussed many times on the FF forum.

David
Ok David I didn't know that. I will read about that now. I was only trying to help traders become better traders.
  • #25
  • Sep 8, 2008 4:37am Sep 8, 2008 4:37am
RedRobin, IMHO the points you made are valid, and you might well have helped readers become better traders. I was just trying to add different perspectives in answering the question "why do 95% (or whatever the number is) fail?"

Personally, I believe that the major key to success is how effectively a trader goes about handling uncertainty, both methodologically and emotionally.

I remember reading in a book by Dr Alexander Elder, how he likened his three "M's" (method, mind set, money management) to a three-legged stool. If any one of the three legs becomes broken or unsteady, the stool topples over.

David
  • #26
  • Sep 23, 2008 8:47pm Sep 23, 2008 8:47pm
Basically they fail because in the long run fail is double easy than win.

Let's say this, you get 100% profit in 1 year, and you need to lose only 50% of them to come back at the starting point.

Now, in the other end, if you loose 50% in one year, you need to make 100% to come back at the starting point.

Trading in the long run is not easy because of this, many traders don't think about this, and they feel like if trading is soo hard, in fact, make profits at these conditions is hard!
  • #27
  • Sep 23, 2008 10:08pm Sep 23, 2008 10:08pm
You can relate the losing trader to those who go into any business and fail at that as well, The failure rate of new business start ups is 50% in the first year and within five years time 90% have failed.
Just some food for thought.

Here is an article about small business failure and why..... see if you can spot the similarities between it and FX failures.... Small business stats
Same Whore .... Different Dress
  • #28
  • Mar 12, 2012 8:53am Mar 12, 2012 8:53am
The reason most traders fail is because they don't see it through the 5 or more years necessary to get profitable.
If it's too good to be true, it probably is.
  • #29
  • Mar 12, 2012 1:39pm Mar 12, 2012 1:39pm
Quoting SimonK
The reason most traders fail is because they don't see it through the 5 or more years necessary to get profitable.
Or as one trader said, "Most people can't outlast the learning curve."
  • #30
  • Mar 12, 2012 2:05pm Mar 12, 2012 2:05pm
Why 95% traders fail ? Because they think that they are better than the other traders , they think that they are in the 5% or will be soon ...
  • #31
  • Mar 12, 2012 9:25pm Mar 12, 2012 9:25pm
The most important reason No Good Karma!
Cleanse your karma, mine is perfect.
Cheers Hermes
  • #32
  • Mar 13, 2012 10:17pm Mar 13, 2012 10:17pm
Most people are trading wrong, plain and simple. You read a book about basketball, then expect to play like kobe the first time you are on the court. You are trying to go for 100 point games when you can barely take a shot, then you get mad, frustrated, and ragequit when things are not playing out as you expected.

In the market this equates to you reading about forex, then go straight to 'making money', when you have not spent your blood sweat and tears doing the legwork behind your system. You don't even know if you like trading, but you know you want to make (insert return here) in some unrealistic time frame. No two traders are the same, which is why you need to figure out how to do this with your own work, you cant just copy-paste some method from someone and expect a mirror image of their success- you don't share the same mind as they do.
  • #33
  • Mar 14, 2012 8:12am Mar 14, 2012 8:12am
Quoting ramdas
Very well said forexlion,
People just forget basic concept, and run behind stupid indicatores.
When i was new in fx ....and knowing nothing about indicatores..even not knowing MT4....i earn very good amount by just looking at price and price behaviour..then on NFP day..i got big hit...and come to know what is NFP with big cost.
Then i started reading forexfactory forums and other forums ...and thinking ............these people knows so many indicator and system..and i don't know anything ...and reading all post.......understanding...
Try trading long above rsi 50 short below. Avoid the choppy's and draw horizontal line in the ranges and trade the breakout close candle. Indicators aren't completely useless.
  • #34
  • Mar 14, 2012 8:26am Mar 14, 2012 8:26am
Quoting redrobin06
After spending nearly 2 years of trading and losing nearly $2000.00 I have learned the reason why 95% of all traders fail. It is the same reason for any business, why some of them fail. Well here is what I learned.

1. Traders allow their emotions, greed, hope and assumption to take over their trading. This is probably the most difficult thing for a trader to do is to eliminate those things while in the Forex business. Did I say "business"? Oh yes it's a business.

2. Lack of Education. Most traders (myself included) are very arrogant when...
About time someone put up some factual evidence. I don't believe in the figure at all. That's as good a guess as all who do believe.
  • #35
  • Mar 16, 2012 9:58am Mar 16, 2012 9:58am
http://blog.100lar3k.pl/2010/10/ilu-...25816854708862
More on my Blog...
  • #36
  • Mar 16, 2012 10:30am Mar 16, 2012 10:30am
1) they don't know what there doing
2) they realise they don't know what there doing
3) they look for info to help them find out what they should be doing
4) they find someone who has a "system" and think they know what to do
5) they realise the the person with the "system" is 15 playing demo and doesn't know what they're doing....(i'm sure they had loads of vouches from other people who also aren't old enough to drink or indeed have any money and also don't know what they're doing)
6) they relise that forex isn't for them and they can lose money in better ways somewhere else.
7) they give it another go
8) repeat 4, 5 & 6
9) they quit

I think thats why....
  • #37
  • Mar 21, 2012 6:13am Mar 21, 2012 6:13am
I totally support the opinion of redrobin69 .
emotions, greed, hope and assumption, lack of education., undercapitalization. ,no plan, no rules, no discipline, no consistency,no money management and overleveraged.

However, I want to add another reason that affects trader’s profits. It is the unjustified trust in the financial analysis on the web, prepared by third parties. Just to remind you about Societe General Bank J Do you remember how their trader lost millionsJ I read his statement and he said “ I was reading and trusting analysis”

Wikipedia: In January 2008, the bank Société Générale lost approximately €4.9 billion closing out positions over three days of trading beginning January 21, 2008, a period in which the market was experiencing a large drop in equity indices.[1] The bank states these positions were fraudulent transactions created by Jérôme Kerviel, a trader with the company. The police stated they lacked evidence to charge him with fraud and charged him with breach of trust and illegally accessing computers. Kerviel states his actions were known to his superiors and that the losses were caused by panic selling by the bank.
  • #38
  • Mar 24, 2012 10:53am Mar 24, 2012 10:53am
In one simple phrase:

Because people do not apply to study and learning
  • #39
  • Mar 27, 2012 10:32am Mar 27, 2012 10:32am
Quoting redrobin06
4. No plan. I know that some traders think they can start a business with no plan in mind. I did that. That's one of the reasons I lost money. I had no plan, no goal. What the trader needs is a plan on how to trade, when to trade, what time frames to use, etc. etc. Without a plan there is nowhere for you to go.
This is the key of the question, having a plan/method, but here comes the difficulty: everyone can learn to write an EA with his method and back testing it, but if you back test an EA time back enough you will realize that 99% of EAs end up losing all the money, that's because 95% of traders fail, and the 1% of EAs that work gives you a ridiculous profit, so, my question is, is there any really profitable method in forex in the long term or you have to change your plan/method everytime?
  • #40
  • Mar 27, 2012 11:36am Mar 27, 2012 11:36am
Quoting jamb0
This is the key of the question, having a plan/method, but here comes the difficulty: everyone can learn to write an EA with his method and back testing it, but if you back test an EA time back enough you will realize that 99% of EAs end up losing all the money, that's because 95% of traders fail, and the 1% of EAs that work gives you a ridiculous profit, so, my question is, is there any really profitable method in forex in the long term or you have to change your plan/method everytime?
i really dont see a reason to why one needs to change anything if he finds it profitable. (duh lol hehe )

i think the wrong part is SEARCHING for systems and not knowledge. i think those are 2 different entities.

im still a relatively new trader but u learn a lot learning knowledge finding it, discovering, exploring, rather than a system.

i might speak in a weird tongue but the above is exacctly how i feel about 'systems'. in the end u apply the knowledge of what u find usable for profit and edge-worthy together into a system.

no i did not mean go grab 5 indicators and make a 'system'
thats what msot do today anyways which is just silly.
Have I got something on my face, SOLDIER?
0 traders viewing now