If 5% of traders are successful, meaning they report trading as the majority of their income, why would you even bother? 5% means 5 out of 100 and its only the majority not all of their income. Meaning they can make 20k a year from trading and 10k a year from something else. That would be eligible for part of that 5% but is that what you expect, if! You are successful? If you are part of that 5% is that what you envision? Also how many hours do you work, technically? If you are successful, meaning you are in that 5%, and you work 80 hours a week would you be happy with, 20, 30,40 or 50 thousand a year?
I see where you're going with this, but you're just throwing out random numbers. Where are you getting $20k from? But even if I agree to work with your $20k profitability number, whose to say that number hasn't jumped to $100k or $400k several years down the line once the trader has even more experience and capital?
As Baron alluded to, your numbers do seem random, and your point even more elusive. When I close out my remaining trades (by end of year), I will have made ~$20K net after commish/before taxes. Total number of hours doing the actual physical work? Hrmm. I guess about 400 mouse clicks, each mouse click takes .1 seconds. So 40 seconds to make $20K? Heh. That is a simplistic way of saying it is not a lot of work, but of course there is the added time of analyzing charts, and the mental work needed. But even with that included, it can average out to 3 hours per day per week. At that point the only difference in income level over same time frame is position size. Double position size, double income with same amount of time of "work". So yeah, I'd rather work 15 hours per week to make $20K than 80 hours per week.
Because the appeal is great: 1. You don't have a boss to report to, and don't need to play corporate games/politics 2. You are not tied up to the office/cubicle 9-5 3. You can live anywhere you want, not where the employment is 4. There is no career "ceiling": it's all up to you 5. You have your own business 6. Many, many more benefits So, yeah, you have a small chance to succeed, but a large impact if you do.
What I mean is that the majority of people consider the 5% number to mean people that are somehow rich but to be eligible to be in that part of the 5% all you need is to report the majority 51% of your income as coming from trading. It does not specify how profitable you are or how many hours you work. Do you think that most people here would consider making 50K a year trading would make them successful? My guess is probably not. Take that 5 out of 100 people and tell me how many you think are wealthy,? Probably 1 or zero. So if they knew that their probability of becoming rich from trading was essentially zero and at BEST was that they would make a living wage would they be OK with risking their life savings? I Used the number of $20,000 as an example and I challenge you to show me how the average investor has more cash to invest, I highly doubt it and if you do, you are the exception, not the rule
The same reason basically everyone applies to American Idol...because we want The Dream, we want to be a rare Star. The Good life. The money can be great, if you are one of the ultra rare skilled and profitable traders. It's just a somewhat...relatively easy process of trading day in, day out (or whatever time frame) and compounding your trades/gains. The sky is literally the limit. Some of the best traders are able to grow a small account into a million. over and over again. -- Where else in life...can you expect to make a million,...you won't make a million being an employee or boss or manager or small business owner. As for hours, generally speaking it's from 9:30AM to 4PM EST. -- You should be able to devote that time block to fully monitoring the market. Some days, it can be way less...if you choose to take profits quickly. I would hardly call it wasting your time -- win or fail. Not doing anything, living life like a robotic sloth...is wasting your time. More people have regretted inaction in life, instead of taking action. Mazal tov, ET extraterrestrials...High-Five`, Xela Merry New Year, d08...i'm currently shopping for a $2K espresso machine on eBay imported from Italy. it looks like something from Charlie and the Chocolate Factory
If you work for a living, someone like Charlie Rose or that Senator guy, might harass you at work, but sitting at home , you're safe. 'cept for trolls.
Some play chess, scrabble, crosswords, horse racing, gardening, Monopoly or build model aeroplanes etc. These entail lots of time, thinking and enjoyment for little to zero financial returns. We all decide in life where we wish to invest our time. Some prefer life with high risks and probability of prison time, that's their decision.