For as long as I can remember, industry lore has “stated” that only 5-10% of individuals who speculatively trade their own accounts are profitable. Recently I heard someone say it is only 3%! I myself have often been asked but in reality I think/thought that only the brokers could know – and they were definitely NOT saying!
Imagine my surprise at an article in today’s WSJ saying that upwards of 30% of FXCM’s accounts are profitable – in the “dark corner” of the FX market no less.
The article of course is about the Journal’s perspective of what appears to them as an abysmal stat – 70% unprofitable. It cites the high leverage and transaction costs for FX traders as two of the “danger” factors.
But here’s the thing – assuming they have some real data (and they have a chart from the company), this is actually good news for the average independent money manager (i.e. retail day trader). Your chances have gone from 5% to almost 30%!