Investing & Day Trading Education:  Day Trading Academy

Do 90% of traders lose money? FALSE

Today, Marcello talks about that old saying that 90% of traders lose money and tries to find a study that backs up that asseveration but finds none.
Due to the lockdowns and all the aftermath caused by the coronavirus, Trading has become more and more popular because of its online and independent nature.
That saying is something Marcello and most of the people in the industry used to say, but he came to question this when he received an article saying otherwise. So, Marcello looked through the first 50 pages of google trying to find studies that backed up that theory; watched a lot of videos about the topic.
There are indeed some studies that show that a higher percentage of people lose money and since Marcello’s been in the industry for 20 years now (even though he looks like a teenager) he knows for sure that most people lose money in the beginning, but most of the people don’t lose money all the time.
Marcello found 4 studies that talk about the percentage of people that lose money trading.
One is from the Brazilian stock exchange. This one said that 97% of traders in their futures exchange lose money. Marcello says this is due to a probably very manipulated market, and they also used a very small sample and only took into account Brazilian traders.
Other is from the ESMA, The European Securities and Markets Authority. They require brokers to report the percentage of losing and winning accounts. He found that only 76.3% of the accounts under the ESMA were reported as losing accounts.
The NASAA also reported that 70% of traders will lose money, and finally the Spanish CNMV, the National Securities Market Commission, says that 75% of people who trade CFDs lose money.

But the real question is, why most people, in the beginning, lose money? Probably because people are sold a dream that they are going to open a small account and after a weekend-long course they will become millionaires and that is NOT TRUE. Trading is a skill that you have to develop over time.

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