Hello everyone. With this post I am going to open up my blog with useful and no bs articles on the topic of day trading. The first article is a bit controversial to what many people like to and have been taught to think.
Fact of the matter is that around 90% of people fail at trading (source). There can be a million reasons why people fail at this, but the fact remains that your odds of success are super slim. So why bother at all I ask you?
For some peculiar reason I still am eager to learn this witchcraft, despite knowing that most traders fail. I am well aware of the fact and a little disturbed by it, but that doesn’t affect my decision of wanting to become a successful trader.
I think that is the case with most of you as well. You know the stats, but you still have this itch that needs scratching. But if you really think about it, the same shitty stats apply to entrepreneurship alike. Only 10% of companies will succeed.
If you think about this for a moment..if people were rational and realise that entrepreneurship only has a 10% success rate, it would not be rational to start this endeavour. Now if everyone were to think this way, we would have no companies and nowhere to work at.
This means that the 10% that do make it will make most of the money that there is to make in this earth. The 90% that fail or are too afraid to even try (most of the 90%) will only earn enough to live off of and maybe a bit more, so that they can afford a vacation or two and maybe even a motorhome.
In addition to making most of the money, the entrepreneurs have the freedom to decide on their use of time. They can work when they want to. Often this leads to working more, but even so, that is their choice.
So we’ve come to the conclusion that despite the 90/10 chances of failure, the rewards can be well worth the effort. The trick is to limit your downside, if you are able to do that, you can create a situation where you have a lot to gain and only a little to lose.
The same goes for trading. Only put in money that you would be OK to lose. This way, yes you are still 90% to lose all that, but at least you are giving yourself the chance of getting out of the treadmill.
To sum up.
Day trading, just like entrepreneurship is a losers game on average, but if you won’t try it, you’ll lose anyways.