80% of traders lose money in the stock market?

[FUTEX]

Since there must be a looser for every winner in a trade, it cant be over 50%.

There is not a loser for every winner. You need to think deeper than that if you are going to figure out how the markets work !

 

[alljoe]

I disagree

 

[FUTEX]

I disagree

I know you disagree, you already stated your position on your last post.

The reason I do not wish to explain to you why an investment grade market is not a zero sum game from a profit and loss perpective, is because if I do that you will not be working it out for yourself.

As a clue , consider what the objectives of the participants are , If that does not wake you up... Then consider that the participants may have differring objectives

 

[N Rothschild]

it actually is on a long enough time frame. in the short to medium term futex is right

 

[FUTEX]

Do not assume all participants are using the markets to make trading profits. Without the fund raisers and the hedgers there would be no futures markets

 

[N Rothschild]

well hedgers etc might not be in it for a trading profit but there not in the market for a loss are they. they are hedging a potential loss on another instrument

 

[FUTEX]

There objectives of hedgers and fundraisers ate different. Very different from trraders. You would have to attend a Futex seminar for me explain why this makes the markets work, and why this means there is a place for Traders that is sustainable. It takes too long to explain here, sorry. Like I said, its not about 50% win 50% lose. It never is a zero sum game.

 

[N Rothschild]

sorry but i don't need to attend a futex seminar to understand how hedging in the futures market works, what with trading futures for 5 years..but thanks for the offer

 

[JRP2891]

There objectives of hedgers and fundraisers ate different. Very different from trraders. You would have to attend a Futex seminar for me explain why this makes the markets work, and why this means there is a place for Traders that is sustainable. It takes too long to explain here, sorry. Like I said, its not about 50% win 50% lose. It never is a zero sum game.

Trading is a zero sum game, sorry to break it to you. Even hedgers are entering the market based on their anticipated future direction of prices, or their fear of future prices. They are making calls just like the little local in your arcade. To say every participant isn't looking for the best price in their respective market is naive.

 

[TakeYourProfits]

Since there must be a looser for every winner in a trade, it cant be over 50%.

Yes... it can. Youre not considering the imbalance of positions taken by different participants.

Even if there were an equal number of participants... lets just say two in this scenario to make your statement true. your hypothesis runs into a problem if one side of the trade is an institution trading $10Mn Lots against a trader taking out a mini lot... in this case, almost 100% of the traders would lose their capital going up against the institution simply because the bank has access to more capital which inherently allows them to play the market longer....

someone trading mini lots is only a trader so long as the $250 in his account remains there... which usually isnt very long when you consider most people like to go "all in" looking for overnight millions....

 

[FUTEX]

Trading is a zero sum game, sorry to break it to you. Even hedgers are entering the market based on their anticipated future direction of prices, or their fear of future prices. They are making calls just like the little local in your arcade. To say every participant isn't looking for the best price in their respective market is naive.

I put it to you, that you neither understand game theory, nor how markets and its paticipants co-intermingle. You assume, quite incorrectly that all particpants trade to maximise the number of ticks they make. One day the penny will drop for you, and if it does not, please come and see me at Futex and I will happlily spend fifteen minutes explaining this to you.

 

[JRP2891]

You assume, quite incorrectly that all particpants trade to maximise the number of ticks they make.

Now where did I say anything about "ticks"? Who's making incorrect assumptions now??

I said that every participant cares about price, regardless of their industry or body. This creates the zero sum condition whether they like it or not....someone is getting a worse or better price immediately after the trade/hedge/IPO etc has taken place. No participant enters the markets to be in a worse position afterwards.

Thanks for the offer of the seminars though.

 

[VendorExterminator]

This is a stupid debate.

FUTEX, you're saying people enter the markets to be losers?? Lol. Wakey wakey.

 

[FUTEX]

This is a stupid debate.

FUTEX, you're saying people enter the markets to be losers?? Lol. Wakey wakey.

NO. I said there are many reasons for trading and participating that are not all based on profit maximisation. That is why it is possible for decades for, lets call them "pure speculator" traders, to continue to exist without destroying the very markets that they extraxt from

 

[Hotch]

This is a stupid debate.

FUTEX, you're saying people enter the markets to be losers?? Lol. Wakey wakey.

Since it's inception, do you think Toyota has made money buying exotic options from the bank?

 

[FUTEX]

Now where did I say anything about "ticks"? Who's making incorrect assumptions now??

I said that every participant cares about price, regardless of their industry or body. This creates the zero sum condition whether they like it or not....someone is getting a worse or better price immediately after the trade/hedge/IPO etc has taken place. No participant enters the markets to be in a worse position afterwards.

Thanks for the offer of the seminars though.

Talk me thru the impact of quantitative easing, and the rationale for that please. Especially extrapolating how the treasury and bank of england are profit motivated. Following that, please expand on how your knowledge of game theory brings you to the extraordinary conclusion that a game where one side is motivated by profit whilst another is not, is zero sum. Once you have educated me on these points I will happily re-instruct our pupils at Futex

 

[pboyles]

I think your time might be better spent on reading up on online reputation management and the dangers of making these sort of aggressive remarks on the internet in the name of your business. No good ever comes of it, though it often provides the rest of us with an afternoon's entertainment.

 

[VendorExterminator]

Since it's inception, do you think Toyota has made money buying exotic options from the bank?

You're missin the point amigo. Even though Toyota aren't trying to profit directly from the purchase of exotic options, they are still partaking in trade, and therefore the seller of those options may or may not profit from this hedged exposure, which may or may not be exercised. What several on this thread are trying to make you amigos see, is that these players are playing the zero sum game just by participating, as someone, or Toyota themselves, will be better off or worse off as a direct result of their participation....even if they're not setting out to profit from a "trade"

Over and out.

 

[FUTEX]

I think your time might be better spent on reading up on online reputation management and the dangers of making these sort of aggressive remarks on the internet in the name of your business. No good ever comes of it, though it often provides the rest of us with an afternoon's entertainment.

Yes PBoyles, you are correct. I have taken your remarks too personally. I aplolgise, and now I have been aggressive to others. So I apologise to them too.

 

[Hotch]

You're missin the point amigo. Even though Toyota aren't trying to profit directly from the purchase of exotic options, they are still partaking in trade, and therefore the seller of those options may or may not profit from this hedged exposure, which may or may not be exercised. What several on this thread are trying to make you amigos see, is that these players are playing the zero sum game just by participating, as someone, or Toyota themselves, will be better off or worse off as a direct result of their participation....even if they're not setting out to profit from a "trade"

Over and out.

You implied that every participant in the market is in it to make money from the market. That was what I was responding to.