On... 90% Fail?
A commonly quoted statistic in trading is that 90% of people lose money or break even and only 10% of traders make money. Is that really true and where did the numbers come from? Intuitively it seems rather pessimistic considering the stock market index has only gone up over time, if you zoom out. If the stock market is an average of all the participants return, then wouldn't at least 50% of traders make money? I would expect that at least 50% of participants make money, or even more. Probably just me being optimistic. I think if it were really true that only 10% of traders make money and the rest break even or lose, I would pinpoint it down to one main reason. Of course there are many reasons like trading is difficult, most people don't have the personality to trade, people are not taking trading seriously, etc. Those are all valid reasons but they are general reasons why you don't succeed in any activity and not trading specific. The reason I think many people fail is b...