I'm interested in the topic of how many traders who make it. We've all heard that 99% of traders don't make it, or be it 99.9%, or optimistically 98%... Now nobody probably denies this is a hard game to succeed in, but I think there are some fundamental things to do to improve these statistics. And I hope we could discuss and add some thing to this topic. Now, if you have 100 beginning traders, and the "statistics" say that 99 will get killed. What does the 1 trader that make it do better? I bet a great amount of the 99 killed traders think it's easy money to trade. They have some amount of capital and just buys some stocks/forex/whatever, just shooting from the hip. Let's short GOOG, hmmm what about buying EURUSD? Money management is another thing that is often overlooked - i.e. betting the farm. Now I think if of the 100 beginners all would have a trading plan and sound money management the number of losers would maybe be down to 50%? And the critical point that determines win/lose is the strategy they are trading. Or what would you think? Is 50% too optimistic still?
I think more traders would succeed if they realized that they have no idea what every other trader will do. The actions of every other trader determine how price moves. Traders that fail do so because their mind is focused on entries. Even those that research, their research is in searching when to get in or even worse, they are searching for certainties. It does not matter where you get long or short at. All that matters is where you sell or cover. Therefore, emphasis should not be on entries but rather on exits. Trading execution is 100% about exits.
Rread the literature (market wizards and so on) Theory is one thing, practice another one. If you survive long enough practicing you have a good chance to become a consistenly profitable trader. In the end it is a lot about you, you personality. For me the markets I am in are like mirrors.
I should have named the thread something in the likes of "surviving" instead of "making it" since I think it is two very different things, if you think about it. To "make it" can be very different if you ask a number of people, but surviving is usually very concrete - to not lose all your money, to not "get killed". Don't you agree?
In the markets it is like everywhere else in nature: It is all about surviving. And getting bigger seems to make surviving more probable. Therefore growing is important. Growing fast is good, growing too fast harms your resources. It is about growing in a controlled manner and step for step without stumbling too much and breaking down. The entrance is practice. And this needs time. Your have to survive in order to gain practice. And then you grow practicing adapting to the ever changing environment but also being consistent in your practicing.
IMO if a person has less than $50k he/she has no business trading full-time, unless through a prop. Actually I think $50k (if that's 100% Net capital) is not enough to trade seriously. Don't forget that to achieve above 70% win rate is not that easy, people quickly realise that when they start trading actual funds. It takes time to become a consistent trader, talent or otherwise immense dedication have to be present.