[carcanaques]

Gamblers Anonymous offers the following questions to anyone who may have a gambling problem. These questions are provided to help the individual decide if he or she is a compulsive gambler and wants to stop gambling. Substitute the words trading or trade for gambling or gamble.

Did you ever lose time from work or school due to gambling?
Has gambling ever made your home life unhappy?
Did gambling affect your reputation?
Have you ever felt remorse after gambling?
Did you ever gamble to get money with which to pay debts or otherwise solve financial difficulties?
Did gambling cause a decrease in your ambition or efficiency?
After losing did you feel you must return as soon as possible and win back your losses?
After a win did you have a strong urge to return and win more?
Did you often gamble until your last dollar was gone?
Did you ever borrow to finance your gambling?
Have you ever sold anything to finance gambling?
Were you reluctant to use "gambling money" for normal expenditures?
Did gambling make you careless of the welfare of yourself or your family?
Did you ever gamble longer than you had planned?
Have you ever gambled to escape worry or trouble?
Have you ever committed, or considered committing, an illegal act to finance gambling?
Did gambling cause you to have difficulty in sleeping?
Do arguments, disappointments or frustrations create within you an urge to gamble?
Did you ever have an urge to celebrate any good fortune by a few hours of gambling?
Have you ever considered self destruction or suicide as a result of your gambling?

Most compulsive gamblers will answer yes to at least seven of these questions.

[brownsfan019]

Car - your posts seem awfully familiar to some posts I've seen at elitetrader. I think this post was verbatim from a thread.

I'll be upfront - so far, your posts are rocking the boat. That's not a bad thing in and of itself, as I have done that myself, but just keep that in mind. Referring to trading as correlated to gamblers anonymous is a stretch if trading is your livelihood. For some, myself included, this is how we pay the bills and create wealth for ourselves and families. So, am I 'addicted' to trading, I'm sure many would say yes. And that's fine with me b/c in order for me to be at the top of my game (and you must be when trading), I need to be 'addicted' to the markets.

I would also argue that the more 'addicted' the trader is, the greater the success. I realize that's debatable, but I will take the trader that studies before and after the markets, studies and documents over the weekend and busts their ass during the day over the guy that just casually goes at it. Even though the casual guy is not 'addicted', I think his potential for success would be next to 0.

So, is it good to be 'addicted' to your 'job' as a trader? I would say yes, esp in the beginning. Anyone that goes into this thinking they will just conquer it with casual work hours is sorely mistaken. If it takes being an 'addict' to get there, so be it.

[carcanaques]

The information comes from GA.

Don't get me wrong, I'm not saying trading is gambling for everyone, but clearly it is for many people who have the propensity to destroy themselves. I thought the post was helpful and if it doesn't relate to you, terrific, but it may be a wake up call to others who aren't enjoying the success you are. You also sound a bit defensive, and I think you took the message out of context.

It's no different than a don't drive and drink ad--if it doesn't apply you ignore it, but if it does, heed the warning and get help before it's too late.

[carcanaques]

But let me be clear. It is a well known fact that 90% of ALL traders lose money and I guess the universe of members here are no different than the norm. A few of them who may be chasing a dream of a trading career and blowing out accounts could have other underlying psychological issues they may not be aware of. So if this posts help anyone who thinks they may have a problem, then it has value and I hope they take action to improve their lives.

[brownsfan019]

Originally Posted by carcanaques »

But let me be clear. It is a well known fact that 90% of ALL traders lose money

And has this fact EVER been substantiated by anyone other than vendors selling the grail? And has this fact EVER been broken down by years of trading, size of account, etc.?

My point is that a $5000 account for a newbie will probably 'fail'. A $10,000 account for someone that thinks they can just wing it will probably 'fail'.

There's a distinction to be made by those that treat this like a real business and those that just wing it.

And if the 'well known fact' could be substantiated and broken down by types of traders, I think the numbers would tell the REAL story. But since this 'almost all traders fail' has been created by vendors and now a part of every day trading, most believe this unproven myth.

Who knows, it could be that 98% of all traders (wannabes and biz owners) fail or it could be that those that actually treat this like a business fail 25% of the time. If there's anything out there suggesting otherwise, I have yet to see it.

In my years trading, I've learned a few things and one of them is that numbers can easily be manipulated to suit your agenda. Unless YOU perform the analysis, or it's being done by an unbiased 3rd party, take it for what it's worth. It's like the drug trials that show a certain drug helps with weight loss and it turns out that the maker of the drug funded the multi-million dollar study. I wonder how that study will turn out... Or how about that many of the muscle magazines out there are actually run and operated by the supplement companies. I wonder why there's so many ads and articles about how great those supplements are... You see where this is going. When trading VENDORS have created this scare tactic of failure, it serves their agenda perfectly.

The best example I have is that while I was a stockbroker, we had brokers broken down into 4 segments. And we tracked this way b/c IT MADE SENSE. Segment 1 was the newbies. We knew that at least 80% of them would fail within 12 mo's. As you can imagine, the further up the segment scale you went, the more likely you would make it as a broker. Actually, by segment 3 it was a matter of how much $$$ you would make.

Trading is no different - every trader can be broken down into segments based on profitability. Let's say segment 1 is those that net out less than $50k per year. Well, I would guess that a good portion of Segment 1's fail. Is it fair to group segment 2's, 3's and 4's with the segment 1's? Of course not. But, as soon as you break traders out based on profitability (like a real business would), those numbers do not suit the vendors as much anymore. Vendors prey on new people and selling the grail. As long as they have you believe that most fail, that just helps them sell their product to you.

As a new person to trading car, you need to realize this. It's similar to sports betting - I'm sure you've seen plenty of junk services out there selling the 'best picks' and you just sit there and laugh b/c you know what they are actually selling. And you see their marketing ploys as well - best picks in all of 2006, big weekend this weekend, etc. Again, preying on people like me that know nothing about betting, but interested in it. Trading is no different. This 'fact' that you quoted has never been proven by anyone. It's simply a marketing ploy that has worked beyond belief. It's like Nike - Just Do It. Trading - 98% fail, so buy my product that will make you part of the 2%!

[aiki14]

Originally Posted by brownsfan019 »

And has this fact EVER been substantiated by anyone other than vendors selling the grail? And has this fact EVER been broken down by years of trading, size of account, etc.?

My point is that a $5000 account for a newbie will probably 'fail'. A $10,000 account for someone that thinks they can just wing it will probably 'fail'.

There's a distinction to be made by those that treat this like a real business and those that just wing it.

And if the 'well known fact' could be substantiated and broken down by types of traders, I think the numbers would tell the REAL story. But since this 'almost all traders fail' has been created by vendors and now a part of every day trading, most believe this unproven myth.

Who knows, it could be that 98% of all traders (wannabes and biz owners) fail or it could be that those that actually treat this like a business fail 25% of the time. If there's anything out there suggesting otherwise, I have yet to see it.

In my years trading, I've learned a few things and one of them is that numbers can easily be manipulated to suit your agenda. Unless YOU perform the analysis, or it's being done by an unbiased 3rd party, take it for what it's worth. It's like the drug trials that show a certain drug helps with weight loss and it turns out that the maker of the drug funded the multi-million dollar study. I wonder how that study will turn out... Or how about that many of the muscle magazines out there are actually run and operated by the supplement companies. I wonder why there's so many ads and articles about how great those supplements are... You see where this is going. When trading VENDORS have created this scare tactic of failure, it serves their agenda perfectly.

The best example I have is that while I was a stockbroker, we had brokers broken down into 4 segments. And we tracked this way b/c IT MADE SENSE. Segment 1 was the newbies. We knew that at least 80% of them would fail within 12 mo's. As you can imagine, the further up the segment scale you went, the more likely you would make it as a broker. Actually, by segment 3 it was a matter of how much $$$ you would make.

Trading is no different - every trader can be broken down into segments based on profitability. Let's say segment 1 is those that net out less than $50k per year. Well, I would guess that a good portion of Segment 1's fail. Is it fair to group segment 2's, 3's and 4's with the segment 1's? Of course not. But, as soon as you break traders out based on profitability (like a real business would), those numbers do not suit the vendors as much anymore. Vendors prey on new people and selling the grail. As long as they have you believe that most fail, that just helps them sell their product to you.

As a new person to trading car, you need to realize this. It's similar to sports betting - I'm sure you've seen plenty of junk services out there selling the 'best picks' and you just sit there and laugh b/c you know what they are actually selling. And you see their marketing ploys as well - best picks in all of 2006, big weekend this weekend, etc. Again, preying on people like me that know nothing about betting, but interested in it. Trading is no different. This 'fact' that you quoted has never been proven by anyone. It's simply a marketing ploy that has worked beyond belief. It's like Nike - Just Do It. Trading - 98% fail, so buy my product that will make you part of the 2%!

Great post, I too would like to see how the 90% statistic bears out in reality. I trade full time and do not see it as gambling, but it is clear from the posts on this and other forums that there is a significant group of "traders" who fall into this category.
I think one thing that differentiates one from the other is the Trader educates himself in order to minimize risk and is usually looking for a consistant, moderate return, while the gambler is looking for a quick large return.

[Reaver]

Originally Posted by brownsfan019 »

And has this fact EVER been substantiated by anyone other than vendors selling the grail? And has this fact EVER been broken down by years of trading, size of account, etc.?

My point is that a $5000 account for a newbie will probably 'fail'. A $10,000 account for someone that thinks they can just wing it will probably 'fail'.

There's a distinction to be made by those that treat this like a real business and those that just wing it.

And if the 'well known fact' could be substantiated and broken down by types of traders, I think the numbers would tell the REAL story. But since this 'almost all traders fail' has been created by vendors and now a part of every day trading, most believe this unproven myth.

Who knows, it could be that 98% of all traders (wannabes and biz owners) fail or it could be that those that actually treat this like a business fail 25% of the time. If there's anything out there suggesting otherwise, I have yet to see it.

In my years trading, I've learned a few things and one of them is that numbers can easily be manipulated to suit your agenda. Unless YOU perform the analysis, or it's being done by an unbiased 3rd party, take it for what it's worth. It's like the drug trials that show a certain drug helps with weight loss and it turns out that the maker of the drug funded the multi-million dollar study. I wonder how that study will turn out... Or how about that many of the muscle magazines out there are actually run and operated by the supplement companies. I wonder why there's so many ads and articles about how great those supplements are... You see where this is going. When trading VENDORS have created this scare tactic of failure, it serves their agenda perfectly.

The best example I have is that while I was a stockbroker, we had brokers broken down into 4 segments. And we tracked this way b/c IT MADE SENSE. Segment 1 was the newbies. We knew that at least 80% of them would fail within 12 mo's. As you can imagine, the further up the segment scale you went, the more likely you would make it as a broker. Actually, by segment 3 it was a matter of how much $$$ you would make.

Trading is no different - every trader can be broken down into segments based on profitability. Let's say segment 1 is those that net out less than $50k per year. Well, I would guess that a good portion of Segment 1's fail. Is it fair to group segment 2's, 3's and 4's with the segment 1's? Of course not. But, as soon as you break traders out based on profitability (like a real business would), those numbers do not suit the vendors as much anymore. Vendors prey on new people and selling the grail. As long as they have you believe that most fail, that just helps them sell their product to you.

As a new person to trading car, you need to realize this. It's similar to sports betting - I'm sure you've seen plenty of junk services out there selling the 'best picks' and you just sit there and laugh b/c you know what they are actually selling. And you see their marketing ploys as well - best picks in all of 2006, big weekend this weekend, etc. Again, preying on people like me that know nothing about betting, but interested in it. Trading is no different. This 'fact' that you quoted has never been proven by anyone. It's simply a marketing ploy that has worked beyond belief. It's like Nike - Just Do It. Trading - 98% fail, so buy my product that will make you part of the 2%!

Great post Brownsfan, funny thing is I was thinking about that statistic for trading failure the other day as I was playing poker.

I jumped online after playing for less than one full day and was placing consistently in the top 5-10 out of 50+ people.....of course it was play money, and of course I am sure a lot of the people playing were beginners or weak players...but then again, so was I and had probably been playing less time than them....I think just going in there with a trader's attitude and playing the probabilities was responsible for the high rankings I was getting.

Of course, as the stakes get higher, etc then things will be a little different, but you have to remember this was literally my first day playing...I didn't even know how to play at all at the beginning of the day. I can see tons of potential.

Once again, the key was to treat it like a business. It seems cliche, but it is true...so many people fail to do this, or make ignorant decision because they want to win it all up front. My approach in poker is to let Natural Selection run its course...and help out when I see a good chance to attack.

Point is- approaching anything, whether trading or poker, is 90% about the attitude and having the backbone to treat it as a probabilities based business. Technique serves to improve this, but as I saw with my own eyes being a totally raw beginner......starting with the right attitude can give you a huge advantage.

[carcanaques]

I don't know how that 90% figure came to be conventional wisdom but I recall reading it in a few books on trading that were not published or authored by people who sell trading systems and the like so what would they have to gain? And of course it's not in any broker's interest to publish a number like that (they already hate those disclaimers) because that might scare even more new folks from taking the plunge. But if you have a great relationship with a broker, he might agree after having a couple of drinks :martini: