How can 90% fail? Delusional and lacking a pair.You might have heard stories of people that were looking for really bad traders so they could do the exact opposite.
There was some guy that had a bot that would look at twitter bets and come up with a rr and wr, he was trying to sell that to a quant fund a few years ago.
There sometimes are some people crying about really awful signal providers, something like .2 RR and 60% winrate.
I just do not understand, they're pretty dense. I hear something like this my first reaction is to run to this guy and "SHUT UP AND TAKE MY MONEY".
You're looking at a 5 RR and 40% winrate! Just take my money man.
Imagine you could find the worse trader in the world, world's biggest twat. You just found the holy grail. Just fingers crossed he doesn't improve.
I keep coming across this story...
A few years ago (Data from a major FX broker* across 15 most traded currency pairs from 3/1/2014 to 3/31/2015) a broker looked at 43 million trades.
What they found really makes you wonder...
On all 15 pairs, their noobs have over 50% winrate, with the lowest AUDJPY with barely over 50% and the highest EURAUD with a little over 60% winrate (euro pairs had 61% on average).
And you guessed it, all of their losers are significantly bigger than their winners. Eyeballing it I'd say they are all between 50% and 100% bigger.
Their average wins and losses are all something like half a daily ATR, so OF COURSE, the majority of these **** HAD to be daytraders. Go figure.
For example, on the gbpusd, their winrate was 59%, they made an average 43 pip profit on each winner and lost 83 pips on losing trades.
So a rr of 0,518.
You see where this is going :D
Let's flip it! Say that including spread = they lose 45 and make 81. RR = 1,8. And winrate is 41%.
The breakeven point is (as long as the risk is low enough...) 35.7% winrate.
The average day trading loser, well not loser, the average period, is 15% above breakeven.
This is not even the average for losers, it is counting winners. So they are doing even worse/better.
If they weren't such **** and went for bigger timeframes, with everything else kept same (they probably follow some dumb mecanical strategy they found from an internet troll), as so the stats are the same but spreads are insignificant;
Then we would be looking, flipped, at a RR of 84/42 = 2. With 41% WR. 41/33.33 = 23% better. Quite an edge!
They wouldn't even need to make much of an effort. They already have a big edge. Just flipping what they do, no hard research required, no sweat. EASY.
Crazy. No to say bigger winners than losers is the only way to go, but in this case... clearly they could be very profitable just by doing the exact opposite of what they usually do...
Why aren't all these losers becoming winners? I'll tell you why I think it's not happening, other than because they are stupid of course.
1- They are greedy and want to grow fast from day 1, so they blow up and never are in long enough to get any feedback or learn anything.
2- They are lazy and so don't look back on their trades. They just can't be bothered holding a journal, backtesting strategies, nothing.
3- They care what other clowns on twitter and crypto forums think, and need to grow a pair.
So you see, it's pretty much IMPOSSIBLE not to be profitable if you really want to. IMPOSSIBLE.
If you are at breakeven and think "I am almost there" I am sorry but I have bad news for you...
It's easier to go from consistently losing trader (if you are able to do what it takes), than breakeven where there is no edge (unless you just practice self sabotage).
I've heard of absolute clowns, that were surprised when someone threw their own numbers back at them showing that they were losing more than winning.
If I was training someone at a firm or whatever I'd get fired because when I'd see someone that is not even aware he lost money in the past 6 months I'd just slap the ****.
I am actually surprised how big the edge is... Pleasantly surprised, especially by the fact that anyone could make it but they are too lazy and too weak.
Also, it is common to hear that in prop firms, every one gets the same equipement and training and learn the exact same strategies when they start and still 5-10% make it and the rest fails.
Strategies can stop working, and it is worrying, but what makes a difference is YOU, as a person. Your edge is YOU, not your strategy or screens.
That's an investment for life. As long as you get good, and can adapt, you will almost certainly always be able to extract money from markets.
