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Traders with 5-10 years of experience but still not profitable
You will get no argument from me here. But what you are saying is not the same as, "the average person doesn't understand." By contrast, you're saying (paraphrasing) "the average person loses". It is presumptuous to know what the average person thinks, understands or feels. I can only speak for THIS average person. I sometimes find some of the comments here unhelpful and unwelcoming. Snide, pessimistic perhaps even projecting the authors own frustrations. Yet others, like yourself have no problem delivering the harsh reality without being condescending. For the most part, I find the people here are generally helpful and welcoming, so I'm not complaining by any means. At the same time, I won't stand for being abused, either directly or indirectly. I don't think Seth's remarks were meant to be mean. But they were insensitively worded, imho.
I am the best scalping day trader alive and make alot of money. If anyone wants to learn hit me up.
Please do not ask me for proof of making money because I do not have any proof. However, it felt really good saying that to see how it feels making such lying statements on forum.
Seriously, if I was making money scalping about 50 ES contract a day. I would not waste time typing this message. And damn sure would not waste time teaching other traders.
I partly agree. If I had been consistently profitable for a while and felt reasonably confident that I could carry on being consistent for some time to come, I would like the idea of teaching somebody to trade.
That however would purely be for the reasons that Dr Steenbarger has mentioned, that trading alone in a vacuum can be difficult which is one reason bricks and mortar prop shop traders have an advantage. The companionship would be nice and having somebody to compare notes with and help keep me in line would be good, ie, it would be embarrassing explaining to them why you broke your rules, lost discipline etc.
Also the saying "learn one, do one, teach one", so teaching somebody would help me think about and reinforce my own methods and therefore would benefit me too.
So personally having a real life pupil then trading buddy/accountability partner could be very beneficial, but I agree with you, I wouldn't be charging them so wouldn't be doing it for the money.
You do not win as a trader, you just get to play again the next day. If that game doesn’t appeal to you then you should not trade. Gary Norden
Numbers I have seen suggest the percentage is probably higher.
Yes.
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I am quite sure that neither Kevin nor Seth have meant anything mean-spirited -- nor have any of the other long-term members here who have posted skeptical views about how "easy" trading success is. They are simply trying, in their different ways, to point out the truth that it is not easily or commonly accomplished. The very title of this thread, about traders who are "still not profitable" after all these years, points to the very real difficulty and to the experiences that people have had on their trek to profitability. The original post seemed to suggest that they "should" be there by now. The OP was surprised that somehow, they hadn't made it. On the contrary, some of the experiences on the forum suggest that 5 years is not a long time for it at all, and it is often simply not achieved, no matter what the effort is.
It may be hard to say this and not sound negative, but the numbers are there, and it is true. The other side is that there are successes, which is another thing to know and remember. I don't think negativity was the point, though, just realism.
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As to mentoring, I had a long DM conversation some years ago with a very successful member, whose name would be familiar to most of the old-timers, who gave up on his attempts to mentor other traders (which he offered for free, btw), because they simply didn't do what he taught them to -- they would come to a potential trade setup and just do exactly what they had always done, just as if he had never told them anything. I think this happened because of the huge amount of trading that is a matter of personal psychology or attitude and emotions and not simply of any intellectually-learned method (my interpretation, as a pure discretionary trader.) He still trades, but has dropped off the forum out of frustration, because he thought he couldn't help people change. I'll of course let him stay anonymous, but this story is true.
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Frustration in getting some of the difficulty of trading across, while attempting to not be totally discouraging, is, I believe, fairly common. But people who have been here a while, and who offer perspectives for others, are doing it with the intent to help, not to harm. I have said before that there is a kind of natural selection when someone comes in to this forum. For those who stay, it is because it had something they are looking for, and for those who leave, it didn't (some are escorted out, to help them with their decision. ) Many simply are never heard from again. The ones who stay, do so usually because of the attitude and outlook we attempt to cultivate, or at least I think so. The forum is here to be helpful, and I hope that, on balance, it manages to be.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
I didn't mean to imply that they did. If I failed to make that clear, I apologize. If I read anyone's comments as "mean-spirited" I would bring it to the attention of the mods. Comments here certainly didn't rise to that.
In my limited experience with the trading community, there is a certain level of rationality necessary to trade and teach successfully. The people who are attracted to trading and stay, generally lean to the rational side... the unrealistic dreamers don't stay long. Numbers and statistics don't bother me and I don't expect that they'd bother any rational people but would be taken as rational caution in the same vein as "Don't step off that cliff." You and others frequently remind us of them. That is a VERY good thing!
I've been trying to avoid specifics here because I didn't want to appear as "attacking" anyone... At the same time, as long as it's being taken in a positive way, I will risk a little more specificity for the sake of contributing to making nexusfi.com a better place. That's not to say that fio isn't already a good place. I find much value here.
My primary contention was a result of the generalization of the "average person" doing this or that thing because they "don't understand." That is negative in my book. It is a comment finding fault with the individuals, not one of numbers and statistics. I'm one of those average people. My reaction to Seth's comment wouldn't have been taken personally (mildly as it was), had it not been for a previous comment he made about one of my comments earlier in the thread. As I recall, someone expressed interest in watching live traders. I suggested a few who do this on youtube that I've watched and found points to appreciate. I also warned that it should be taken with a grain of salt as there is no way to know for sure they aren't trading sim accounts. Seth's response is below:
So I'll just come back to what's their 5 year sharpe ratio?
I'm sorry that I end up picking on you, but it's really frustrating to talk about it in the thread already and still see people making the same mistake. To show that a trader …
At no point did I claim that some youtube personality has an edge or were successful traders. Yet Seth seemed to understand his comment as "picking on" me. I didn't see it as such, however, the comment that "The average person doesn't realize how easy it is to fake successful trading even to a live audience," I took as a direct reference to my comment about watching live trading earlier in the thread.
My point is that people are as complex as the markets. Claiming to know the cause of some effect is not the same as citing statistics of the effect. People often vote against their interests. People watch reality shows and wrestling that they know are fake. Where I find this insulting is in the claim that I don't know something and THAT is the reason why I have watched trading videos. There are many (very good) reasons why I (or others) might watch those videos and I can still know quite well that they are fake. This was the point I was trying to make. To get frustrated because one assumes the reason behind another person's actions is generally because the ascribed motivation is wrong or one has unrealistic expectations. How ironic that this thread is about beginner traders having unreal expectations. Having unreal expectations of people is no less incomprehensible to some.
Frustration with ones inability to communicate is something with which I can relate. I have struggled with finding the right words for this post. I do hope that I was successful in conveying my meaning in the positive spirit I intended. I see fio as a positive community. (That most certainly includes Seth and Kevin!) That is why I am here. That is why I try to contribute what little I can even if it's only in pointing out how a beginner might find insult where none was intended.
Thanks for the thoughtful response, @chipwitch. The pessimism some folks have can stem from being burned by shills or watching others being burned. Speaking for one of these folks whom I know well, his pessimism stems from a healthy skepticism and wanting to protect and educate others. Sometimes it has to be blunt and frank, other times maybe a gentle nudge will do.
Regardless, the reason for my response is that the book I mentioned earlier, The Futures Game, discusses two attributes of winning and losing traders in the same chapter (13): forecasting skills and behavioral skills. Though the authors provide plenty of data stretching back nearly 100 years to support their quantitative conclusions, they show that these qualitative attributes have an impact on trading results. They also talk about longevity, i.e. can you stick it out through some very difficult days, weeks, months, or years?
The professionals, on aggregate, hit a peak in 2015 and had nearly 6 years before seeing a new high. How many retail people can hang in there for 6 years before hitting a new equity high? For comparison, this chart represents approximately a 12.7% return from 2000, compared to about 9.2% from the S&P 500 over the same period.
Anyhow, I got a little (a lot) off-track here, but I just wanted to add that forecasting and behavioral skills are pillars of trading, which I think talks to your point of what average people think. The researchers have looked at the quantitative results (80/20), but also trading style and have made inferences from the data to come to their conclusions, i.e., they made inferences, right or wrong, into what average people (traders) think based on their observation and the data. If you want to dig into some of the more academic aspects of futures trading, this book is good, though huge (600+ pages).
Financial markets have a tendency to exhibit fat tails and other odd statistical distributions that make them difficult to analyze. Such distributions fool the tools that we are taught in school such as root-mean-square. One of the biggest problems this causes is with sample size. The more fat tailed your distribution is the more samples you'll need to see the real statistical properties of the distribution. To deal with such distributions it requires tons of samples, and graduate level statistics.
Humans are not very good at comprehending large numbers, and the math in high school never gets advanced enough to deal with these problems. I can't quantify exactly how many people understand this stuff, but there's not very many masters level math graduates out there. Of course, retail trades can learn this on their own by reading Taleb etc, but comments suggests the majority of participants haven't done that. Posters continue to rave about a few months of results they saw on YouTube even after we've established in the very thread that it requires tens of thousands of samples to get useful statistics.
But what we're getting at now is how do you deal with the problem, and I'm finding the turnover to be a key issue. It doesn't matter how effective you get at teaching it, the turnover in the space means the majority of the community will always be ignorant of these concepts.
Now that might not sound very compassionate or understanding. That's certainly what I thought when I first heard these things. I didn't want to accept it, and my first thought was they must just be projecting. All I can do is laugh about it because I had the exact same reactions. But there's no way I would have lasted this long otherwise. I'm not here to make you feel good. I'm here to give you the best chance. The first step of that is understanding reality as it really is despite what we'd rather believe.
) Many simply are never heard from again. The ones who stay, do so usually because of the attitude and outlook we attempt to cultivate, or at least I think so. The forum is here to be helpful, and I hope that, on balance, it manages to be.
