The honest truth is that 95% of us don't make money. We just keep deluding ourselves that we make money (while we kept our losses secret) and keep refueling our account.
You mean for living, over the long term or at all?
I meant for most of us, we either quit and take up new hobby or we keep refueling the account for another go at it.
We follow simple ideas we found in a book read by countless others and decide to trade it. We might do some backtesting on such idea while ignoring that real trading is more than just about picking numbers on where to buy/sell.There is requote, low liquidity or even black swan events.
If the market efficient theory is true( got massive evidence that the market is at least weakly efficient). It means looking for profit's opportunities is very difficult. And looking for opportunities isnt even the trading part yet.
Got your point. When it comes to the profit opportunities, I think they will always be there for us to take them. But it depends on your perspective tot he markets. FX is close to the ideal competition model in my opinion.
You make a great point, @Charles_F
While trading is not for everyone, the opportunities do exist. FXCM's guide on the traits of successful traders explains how the minority who make money overall tend apply certain best practices which the majority ignore either due to lack of knowledge or discipline.
For example, open nearly any book on trading and the advice is the same: Cut your losses early and let your profits run. When your trade goes against you, close it out—better to take a small loss early than a big loss later. But how many traders actually put this into practice?
Historically, this simple adage has been difficult to for most people. Take the EUR/USD. Our data show EUR/USD trades closed out at a profit 61% of the time. But the average losing trade was worth 83 pips while the average winner was only 48 pips. Traders lost 70% more on their losing trades than they won on winning trades. Remember that past performance is no indication of future results.
Why the imbalance? Human behavior toward winning and losing can explain. People don't like accepting a loss, so most will hold onto a losing trade for longer than they should. Conversely, they don't let their winners for long enough, because they want to satisfaction of booking even a profit, and fear it will turn into a loss if they hold out for more.
A key trait that sets the profitable minority apart from the losing majority is that profitable traders tend to have winning trades that are at least as big as their losing trades in terms of pips. Of the traders who followed this rule, 53% turned a profit; of those who didn't, only 17% turned
a profit. Traders who adhered to this rule were three times more likely to turn a profit—a substantial difference.