Impossible to make a successful career trading

Starting a new thread at the recommendation of the moderator.

quote:

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Originally posted by mmartinez


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The number of traders who score big or end with a positive P&L falls within the realm of chance. This means that skill does not play into it at all.

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So a few random people are randomly very lucky ?

Sounds like trading is the equivalent of a lottery ?

This raises a question in my mind, why are the same people consistently the ones that are randomly lucky ? Conversely, why are some people consistently unlucky ?

In my world, trading is a combination of hard work, patience, perseverance... and the occasional vacation to Hawaii or the South Pacific...

Have to mention to Bruce Kovner, borrowed 3000$ + on his credit card to trade...now worth near 3 billion, it was all luck

Mr. Mmartinez;

Every day @ the same time I snap a line on my chart.

I call this line "Time Price Pivot Point" and since
it is time that sets the price the only thing that
is random is the price...the time never changes.

Originally posted by mmartinez

Okay so here's the thing. The mistake you guys are making is thinking that if someone has a "successful" trading outcome, it is due to that person's skill.

No it isn't. The number of traders who score big or end with a positive P&L falls within the realm of chance. This means that skill does not play into it at all.

That's an interesting comment and something that I think is provable if it is true. The way that you would prove it is to take the percentage of successful traders versus all traders over a given time period. The compare that to the percentage of successful gamblers (in say Vegas) over the same period of time. If that figure turns out to be the same then I think that there is merit in that theory.

Of course doing this exercise would be costly and time consuming. However, there may be a large mutual fund that wanted to prove that investing is an activity in which skill plays a part and would fund something like this.

The same argument can be made for starting a business. Just a any regular business, not a trading business. How many are started every year? How many fail in the 1st year, 2 years, 5 years?

I don't know the number but it is a very high percentage >75%.

Of the ones that continue doing business, how many are highly profitable. That's even less of a percentage.

So people that want to try and say you can't do it in trading and if you do its all luck.....well, that same exact statement applies to starting any business. I started and ran a successful business, looking back so many things came down to timing and luck. Ask any successful business person and I'm sure they will agree.

Just like poker. Skill only gets you so far and puts you in a position to get lucky. You still have to get lucky to win. But the more skill you have the more your odds of getting lucky increase are.

I have pondered this topic quite extensively. Pretty much after most losing days. After my head gets clear, I always come back to the same thought.......Isn't this the same as running a business. Every day can't be good or great. There are plenty of bad days. Running a business....somedays you lose valuable employee....how much does that cost??? some days you lose sales deals....how much does that cost??? Some days you lose customers....how much does that cost???

So just like anything else that is worth doing. It's hard and can't be a straight line up. There is always a competing force that acts as resistance.