Stop Saying 90% Of Traders Fail! They DONT!

Trading Discussion
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You’ll see this EVERYWHERE. “90% Of Traders Fail”, “Why 4 Out Of 10 Traders Won’t Be Profitable”, “You’ll Probably Fail At Trading, Here’s Why” (yes I’ve seen that). These sayings are all very popular…and we need to stop saying them.

Why?

…Well because they aren’t really true.

Why is this statement untrue exactly? Well, its the word “Trader”. When you’re saying traders fail, what you really mean is People fail. Random people who jump into trading not knowing a lick of how anything works aren’t traders. Just like random people aren’t doctors and engineers. If they were, 90% of doctors and engineers and teachers and mayors would all fail. They don’t. Why? Because that 90% aren’t actually doctors or engineers or teachers or mayors, but just random people who don’t know what they are doing in that specific field.

Traders are the same thing. They are people who fully understand what trading is, how it works and how to do it. More important, how to do it profitably. You can’t open up a brokerage account and be a trader. You have to learn and study and practice for months even years until you’ve truly become one. AND even after you’ve done all that practicing, it doesn’t matter until you show results. Just like a university grad isn’t a doctor right out the gate, he needs to get the job.

Why is saying, Traders and not People, bad?

Saying 90% of Traders fail is bad because it gives a false representation of what traders are. And more importantly, what they can accomplish. It makes it seem like the market they deal in is way more difficult to perfect than it actually is. And it pushes others who want to try to learn, away out of fear of losing.

This isn’t a good way to teach people conservatory attitudes or be “realistic”. It’s just false.

This saying destroys the root of what traders are and makes them lose face. No one will treat them seriously. Why? Well 90% of them fail, so who’s to say you’re the 10%?

It’s not “90% Of Traders Fail”.
It’s "90% Of People Fail"

And that’s only because they haven’t typed in babypips.com and learned how to actually trade.

Don’t get discouraged. Happy Trading.

-Zhadow

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I get your point, but the difference between people calling themselves fx traders and doctors/teachers etc is the complete lack of barriers to entry in fx.

You cant call yourself a doctor or teacher if you haven’t any formal qualifications, but you can call yourself a trader the moment you place your first trade.

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Although thats the case with becoming a Doctor, that isnt the case for being an engineer or teacher or really a large pot of careers and jobs people do on a day by day basis every second of every day. Trader isnt any different. Who said you’re a trader the second you place your first trade? I don’t think you’re a trader at all. I dont think you’re a trader until you’ve become profitable and go fulltime with trading. (Or respectably part time). No one is a trader just because they place one trade thats ridiculous. If thats your definition of trader. Then being a trader is valueless and I dont want people calling me that.

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Ahh this is a juicy dialogue and I’m intrigued to hop in.

First off what you wrote was a very good piece and I also feel the same way. In regards to lets say trader qualification I feel there is a somewhat agreed on standard amongst actual traders but it’s not like its in a written book or something. What would you then accurately call a trader or a person who is a trader?

  • Someone whose been trading for a certain amount of time?
  • Someone whose been profitable for a certain amount of time?

If so what are the parameters for that. I think the issue is it’s much harder for us to carve out a set guideline to identify an actual trader vs a doctor, engineer, analyst, etc. Though it might also be the reason why so many people are able to get into forex and try to learn and understand the markets, whether it’s strictly for financial or educational purposes. The issue I feel the majority of new traders struggle with is the “get rich quick” mentality. Not understanding a doctor didn’t become a doctor overnight, just like the engineer, the financial analyst and so forth and so on. The rush to ascertain wealth blinds them from truly trying to understand and to learn about the markets just as you would do any occupation. The fact that we don’t take it as serious as if we were at work is a major misstep, you mix money into the mix and you create a hazardous solution. You can survive in the markets if you’re willing to learn patiently and understand this is not a race to the finish line. We are here for the long game and anything you do honestly should be treated as such. Perfecting any craft takes time and the markets are no different but you’ll only get better with practice and that takes time.

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I 100% agree. And if a person has the mindset you just explained, believing its some way to fame or not taking it seriously, they aren’t a trader. People say they want to become a doctor for money, some don’t take it seriously. And, therefore, aren’t doctors. Because they didn’t put in the effort.

I don’t think its hard to say what a trader is at all. We all have this weird though process where we want to be humble and always try to act as if we are still just students, but we need to know that eventually…we become the teachers. How is a professional baseball pitcher professional? How is he good? What makes him a pro?

Results.

He got on his team because of results, he got to be the best in the world because of results.
Not begin humble, not saying it’ll turn around in a year, no. Pure results. I dont find that to be bad at all for traders to have that mindset.

What makes a someone a trader?

Someone who shows results and shows the correctly. Not someone who gambles and gets results no no, someone who does it right, and proves their ability. They are true traders. Only them. If we keep having this mentality that anyone and everyone is a trader, then being a trader will mean nothing and it’ll ruin our drive.

“Traders will always lose so you cant base things off of results”

I don’t believe in that at all. Doctors are doctors because of results. Analysts are analysts because of results. Pitchers are pitchers because of results. If you want to trade, the idea is you will bring in consistent overall positive results. So why are we acting as if results isn’t a qualifier?

This is what I believe. Thoughts?

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love it! That completely change the perspective.

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I agree wholeheartedly. The results at the end of the day separate an actual trader from someone claiming to be a trader. You’re obviously not going to listen/heed the advice of someone whose been trading for a couple months vs a couple years. With those results comes experience that are little badges that get added to your armor. You’ll start noticing habits, you’re able to decipher what you’re looking for easier, able to compile a strategy that works for you. This all comes with experience and the time you put in to the actual markets.

Traders will lose but it’s accepting that if your efficiently winning the losses you rack up will never outweigh your wins (so to speak).

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Completely agree. Amazingly said.

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And you’re fully entitled to your opinion, as am I.

Don’t entirely agree with everything being said. I don’t know of any education establishment that would accept an unqualified teacher and using professional sportspeople as an example isn’t comparing apples with apples either.

Anyhoots, you’re free to classify as you wish and I have no desire to change that. Perhaps differentiating between professional traders and amateurs would be a more useful way to continue the discussion?

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I think there are successful amateur trader and losers professional traders.

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As a successful amateur, I have to agree with you

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I wasn’t comparing unqualified teachers getting a job to trading. Actually, the opposite if anything. I was stating that people could technically call themselves a teacher (What a lot of "forex’ “gurus” do for example) without actually knowing any of the content. I didn’t necessarily mean high school teachers however the point still stands. You cant just…be a teacher. You have to go to college. So yes I agree with you, that’s exactly my point. That degree shows one thing = Results.

As traders, we don’t get degrees, but that doesn’t matter. The results are still the same. The issue with comparing Professional Traders to amateurs is, saying amateurs is assuming the person knows a decent amount and understands the idea of being a trader but just doesn’t have the perfect skill or experience. We aren’t talking about those people. We’re talking about everyone who tries to trade and just throws cash onto a dartboard.

The reason we are speaking about these people and not new traders vs pro traders is because that is what media sources that talk about 90% of people losing are referencing in their numbers. My simple addition to the conversation is those people don’t count as traders. So stop acting like they are. They’re just normal people trying to get lucky. Amateur traders vs pro traders is a completely different conversation.

Successful amateurs are fine. They are the pride of traders. They make up the true pure form of traders who truly understand the markets. If you call yourself a successful amateur why would you want that title dirtied with assumptions that every joe shmoe with $100 is now magically a trader? All im saying is that they arent. People like you are traders. Im not even considering myself a trader. I respect and honor people who have done what you have done and use you all as drive to reach my own goals. I dislike when others disprove your ability and hard work by acting like you are on the same level as some random jeffrey trying to hit a jackpot.

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First of all it is important to understand that 10% success rate absolurely normal for any profession. For example, only 10% of the law student will become partners at the law firms. How many young musicians will become famouse? The problem is that everyone who starts trading believe that he will succeed. It happens because of aggressive advertising policy of brokers saying that everyone will earn his million.
Another point is using the word “trader”. To my mind, it depends on the purpose and attitude. If someone is going to make trading his own source of income, he is a trader. For example, not each person with camera is the photographer, but anyone who earns money for living making photos is a phtotgrapher, despite his official qualification.

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I as well, agree with you. Of course, the person who is going to make trading his income, he isnt a trader until he actually gets to that point, just like the photographer. However, my point with the 10%, Although 10% Is relevant for some high heavy careers, im not here arguing whether its normal, im literally arguing that its not at all the facts because of how I think we should define traders.

If you believe anyone who places one trade one time is, in fact, a trader, then yes, 90% of them fail.

But if you believe that anyone, like you said, is a trader if they make it their own income, then no. 90% of them do not fail.

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Dude, you live in la-la land…

I think you are missing the point of 90-90-90 rule… it’s a generalization, but it is accurate.

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idk if you’re talking to me or what you are talking about, but insulting my intelligence is pretty ridiculous for this dialog. This convo is specifically based upon the definition of “Trader” and what everyone believes it means. It’s definition changes what some aspects of a traders average expectations are. Saying I live in lala world…like what? What are you even talking about?

OKAY, so I looked up the 909090 rule. Its literally what i alreayd said, I think you are literally missing my point.

IM NOT SAYING THAT 90% OF PEOPLE DONT FAIL. Im simply saying that we should define who exactly is losing all that money. Traders, or People. IMO, if we say, traders, we hurt our title and ruin our reputation. If we say, People, we allocate that loss onto people who clearly arent actually working to learn and more so just want to get lucky.

Im not acting as if the 90% didnt exist. You didnt even read my post.

Please odnt waltz in here and insult me when you haven’t read what I wrote, you’ve pissed me off already.

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So it all boils down to how we define and categorize the word “trader”, not necessary the act of trading itself. Because the activities range very wide on the spectrum we all call " trading". I was one of these losing traders when I first started out but I stuck with it and eventually found a successful strategy and continue to learn everyday. So what am i? I was in the 90% now I’m in the 10% . Learners evolve into winners. Losers disappear into the 90%

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I would find it very helpful if companies could display clarity in what they mean by eg 90% fail. Is that 90% of the number of people? and over what period of time? And what is the average loss or is that 90% of the money invested is lost? They must have these figures easily

It almost seems a random number as they are presumably obliged to publish something like that!

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This is the type of educated banter that keeps me coming back to babypips forum. I love that the people here have a passion for what they believe in. Just the fact that you are here giving an opinion says that you ALL are successful traders, (not sure I have reached that title yet) because you are willing to give input to help others move away from that percentage that fail. As an almost trader, I look forward to my daily email on new posts here so that I can improve my skills. Thank you all for being part of my success. I hope that I too someday will be part of this “results” group.

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My provider says “76% of retail investors’ accounts lose money when trading spread bets and CFDs with this provider” with a footnote to say the figure is based on the 12 months preceding 1 April 2019. Seems clear enough!

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