NexusFi: Find Your Edge


Home Menu

 





Can Day Trading be profitable for retail?


Discussion in Traders Hideout

Updated
      Top Posters
    1. looks_one jefforey with 21 posts (9 thanks)
    2. looks_two wldman with 10 posts (33 thanks)
    3. looks_3 artemiso with 10 posts (71 thanks)
    4. looks_4 blb014 with 9 posts (5 thanks)
      Best Posters
    1. looks_one michaelleemoore with 13.8 thanks per post
    2. looks_two bobwest with 8.8 thanks per post
    3. looks_3 artemiso with 7.1 thanks per post
    4. looks_4 wldman with 3.3 thanks per post
    1. trending_up 45,208 views
    2. thumb_up 370 thanks given
    3. group 30 followers
    1. forum 105 posts
    2. attach_file 6 attachments




View Poll Results: Can Day Trading be profitable, consistently, for retail traders
Yes 133 69.27%
Yes
133 69.27%
No 23 11.98%
No
23 11.98%
Can't say 36 18.75%
Can't say
36 18.75%
Voters: 192. You may not vote on this poll

 
Search this Thread

Can Day Trading be profitable for retail?

  #71 (permalink)
 
bobwest's Avatar
 bobwest 
Western Florida
Site Moderator
 
Experience: Advanced
Platform: Sierra Chart
Trading: ES, YM
Frequency: Several times daily
Duration: Minutes
Posts: 8,162 since Jan 2013
Thanks Given: 57,343
Thanks Received: 26,267


artemiso View Post
This means that only 21% of trades taken by accounts categorized in that group make positive gross PnL.

...
Trimming it down a lot: 79% of trades taken by small accounts lose money (to market maker). Does this make sense?

These are extraordinary posts. Thanks for providing exact quantitative data on the question.

It's no wonder that such a small percentage of retail traders will succeed, with stats like this. Of course, there will be some that do, just not many....

This puts it well, and is hilarious, too:

artemiso View Post
The reason is quite simple really, I agree with @Anagami. Daytrading is like being a stay-home writer, most people lose money and it's not that the system is rigged against stay-home writers, it's just good literature is a very competitive and efficient market.

Bob.

Reply With Quote

Can you help answer these questions
from other members on NexusFi?
NT7 Indicator Script Troubleshooting - Camarilla Pivots
NinjaTrader
My NT8 Volume Profile Split by Asian/Euro/Open
NinjaTrader
Online prop firm The Funded Trader (TFT) going under?
Traders Hideout
The space time continuum and the dynamics of a financial …
Emini and Emicro Index
Exit Strategy
NinjaTrader
 
Best Threads (Most Thanked)
in the last 7 days on NexusFi
Get funded firms 2023/2024 - Any recommendations or word …
59 thanks
Funded Trader platforms
37 thanks
NexusFi site changelog and issues/problem reporting
22 thanks
GFIs1 1 DAX trade per day journal
22 thanks
The Program
20 thanks
  #72 (permalink)
 
michaelleemoore's Avatar
 michaelleemoore 
Missoula, MT Nɫʔay(ccstm)
Market Wizard
 
Experience: Advanced
Platform: NinjaTrader
Broker: NinjaTrader
Trading: CL, ES
Posts: 3,436 since Nov 2012
Thanks Given: 5,552
Thanks Received: 12,328


artemiso View Post
The horizontal axis is gross (brokerage fees excluded) PnL of individual trades.

The vertical axis is cumulative probability, meaning probability that a trade makes profit of up to the amount on the horizontal axis.

If you see the orange curve, the cumulative probability of making $0 is around 79% for the group of traders in the orange curve. This means that only 21% of trades taken by accounts categorized in that group make positive gross PnL.

I can express this by cumulative profit of individual accounts on the horizontal axis too to arrive at the statistic you asked your broker for, but that isn't as a meaningful as knowing the outcome of individual trades because it's harder to normalize accounts as they have subscriptions and withdrawals, different account length etc.

Trimming it down a lot: 79% of trades taken by small accounts lose money (to market maker). Does this make sense?

I'll never be a 1%er, but being a 21%er ain't half bad

Follow me on Twitter Visit my NexusFi Trade Journal Reply With Quote
Thanked by:
  #73 (permalink)
 
paps's Avatar
 paps 
SF Bay Area + CA/US
 
Experience: None
Platform: TS, TOS, Ninja(Analytics)
Trading: NQ CL, ES when volatile mrkts
Posts: 1,739 since Oct 2011
Thanks Given: 2,176
Thanks Received: 1,726


retail is at a YUUUGE advantage .....

try moving big money...is not so easy. small money but taking consistently off the mrkts....much much easier. simple math think u can make as much with an acct size 10 or 20times more than current. it may not be that easy. well just my small mind talking at OVN (:

Reply With Quote
Thanked by:
  #74 (permalink)
 
SMCJB's Avatar
 SMCJB 
Houston TX
Legendary Market Wizard
 
Experience: Advanced
Platform: TT and Stellar
Broker: Advantage Futures
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,041 since Dec 2013
Thanks Given: 4,375
Thanks Received: 10,192


wldman View Post
I read all of your posts that show up in the log. There are a few names I scan for as sources of specific and valuable insight. @artemiso , top of that list.

Me to

Reply With Quote
Thanked by:
  #75 (permalink)
 
SMCJB's Avatar
 SMCJB 
Houston TX
Legendary Market Wizard
 
Experience: Advanced
Platform: TT and Stellar
Broker: Advantage Futures
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,041 since Dec 2013
Thanks Given: 4,375
Thanks Received: 10,192

Hey @artemiso I just noticed you've finally become a futures.io legend. I've never understood how half the people here were 'legends' (aka "red") but you weren't. Being a member of the club has more value now that your in it.

Reply With Quote
Thanked by:
  #76 (permalink)
 
nathanologist's Avatar
 nathanologist 
Burlington, Vermont
 
Experience: Beginner
Platform: StockTwits
Broker: Robinhood
Trading: ES, GC, ZB
Posts: 708 since Jun 2015
Thanks Given: 879
Thanks Received: 781


artemiso View Post
Trimming it down a lot: 79% of trades taken by small accounts lose money (to market maker). Does this make sense?

So, basically, if you want to make $100k you have to be willing to lose $100k and you've got ~50% chance of either outcome? and if you try to alter those odds, in general, the probability is that you will lose less than $100k most of the time?

Nate
Follow me on Twitter Visit my NexusFi Trade Journal Reply With Quote
  #77 (permalink)
 jefforey 
edison new jersey
 
Experience: None
Platform: motivewave
Trading: ES
Posts: 69 since Nov 2016
Thanks Given: 45
Thanks Received: 18


michaelleemoore View Post
I'll never be a 1%er, but being a 21%er ain't half bad

That's not artemiso meant. He said gross profit. I bet the majority of the top 21 percentege is loosing to commission.

Started this thread Reply With Quote
  #78 (permalink)
 
bobwest's Avatar
 bobwest 
Western Florida
Site Moderator
 
Experience: Advanced
Platform: Sierra Chart
Trading: ES, YM
Frequency: Several times daily
Duration: Minutes
Posts: 8,162 since Jan 2013
Thanks Given: 57,343
Thanks Received: 26,267


artemiso View Post
The horizontal axis is gross (brokerage fees excluded) PnL of individual trades.

The vertical axis is cumulative probability, meaning probability that a trade makes profit of up to the amount on the horizontal axis.

If you see the orange curve, the cumulative probability of making $0 is around 79% for the group of traders in the orange curve. This means that only 21% of trades taken by accounts categorized in that group make positive gross PnL.

I can express this by cumulative profit of individual accounts on the horizontal axis too to arrive at the statistic you asked your broker for, but that isn't as a meaningful as knowing the outcome of individual trades because it's harder to normalize accounts as they have subscriptions and withdrawals, different account length etc.

Trimming it down a lot: 79% of trades taken by small accounts lose money (to market maker). Does this make sense?

To be clear, @artemiso's data shows that 21% of small-account trades make money (pre-commission and fees) -- or 79% lose -- not 21% of small-account traders.

With this data, a given trader in the small-account group could have 100% profitable trades (not too likely), or 0% profitable trades (probably some do.) The data does not group the trades by account, for reasons stated. Most traders will have something in between, but the overwhelming bias will be toward losses, which is the best takeaway from this. (Someone doing no better than the average for the group will have only 21% winners, which is not a good number. There may be outliers who do better, possibly much better, but probably not many.)

Also, these are gross P/L numbers, without commissions and fees, so the actual positive results will be less. However, assuming that most of the 21% of winning trades will be net losers after fees is not something that is in the data, and individual fees will be different for different trades. Certainly the net after-fees number of winning trades will be less by some amount.

This does not show that profitable trading is impossible for the small trader, but it does show that it is difficult and seldom achieved. This is consistent with industry lore (it is often said that "95% of traders fail") and with the general experience on this forum. Traders need to understand the probabilities of what they are attempting, and these are real numbers that address that.

Bob.

Reply With Quote
  #79 (permalink)
 jefforey 
edison new jersey
 
Experience: None
Platform: motivewave
Trading: ES
Posts: 69 since Nov 2016
Thanks Given: 45
Thanks Received: 18

also artemiso is quoting figures for fx only for his brokerage. I am not sure the numbers can be extrapolated to cover the entire universe of day-tradable instruments over all brokerages.

Started this thread Reply With Quote
  #80 (permalink)
 
wldman's Avatar
 wldman 
Chicago Illinois USA
Legendary Market Wizard
 
Experience: Advanced
Broker: IB, ToS
Trading: /ES, US Equities/Options
Frequency: Several times daily
Duration: Hours
Posts: 3,507 since Aug 2011
Thanks Given: 2,046
Thanks Received: 9,491



jefforey View Post
also artemiso is quoting figures for fx only for his brokerage. I am not sure the numbers can be extrapolated to cover the entire universe of day-tradable instruments over all brokerages.

FFS can't you see the forest through the trees.

Visit my NexusFi Trade Journal Reply With Quote
Thanked by:




Last Updated on July 17, 2018


© 2024 NexusFi™, s.a., All Rights Reserved.
Av Ricardo J. Alfaro, Century Tower, Panama City, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada)
All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
About Us - Contact Us - Site Rules, Acceptable Use, and Terms and Conditions - Privacy Policy - Downloads - Top
no new posts