Statistics:
As per the scientists, 95% of all traders fail. The report goes on to say:
- 80% of all day traders quit within the first two years
- Among all day traders, nearly 40% day trade for only one month.
- Within three years, only 13% continue to day trade. After five years, only 7% remain. Profitable day traders make up a small proportion of all traders - 1.6% in an average year. However, these day traders are very active - accounting for 12% of all day trading activity
The fact is that if the stock is down by 10%, the stock has to go up by 11% to break-even. If the stock is down by 90%, the stock has to go up by 900% to break-even; it is unlikely stocks will ever go up by 900%, most likely this will be a total loss.
Source: Created by Author
Why stop-loss
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