Forex Trading – Is It True That Only 5% Of People Make Money?
If you have been trading forex for any length of time, you will inevitably have been told at some point that only around 5% of people who try their hand at forex trading actually make money. However with all US brokers having to reveal the profitability of their customer accounts, these numbers appear to be completely inaccurate.
The truth is that more people are making consistent profits from currency trading than many of us thought. The number of profitable accounts varied from broker from broker, but they all reported a figure far higher than 5%. In fact even the lowest figure was 20%.
The average was between 20% and 30% whilst Oanda issued results that showed that 51% of their traders ran profitable accounts for the previous quarter. This does seem incredible to think that more of their customers made money than lost money, but it just goes to show what can be achieved in this potentially very lucrative industry.
Of course the fact remains that apart from Oanda’s extraordinary figures, in most instances the majority of traders still lose money overall. That’s hardly surprising of course because not everyone has the necessary skills to not only come up with a winning trading strategy, but also to maintain the discipline needed to enforce strict money management rules and stick to this system at all times.
At the end of the day forex trading is not really that different to any other industry because if you look at it as a business, there will always be more failing businesses than successful ones in all walks of life. It’s perfectly normal for there to be more losing traders than winning ones.
Anyway the point is that these figures that have been released from the brokers operating in the United States should serve as an encouragement for anyone looking to enter this exciting industry. Despite the fact that many people will tell you that 95% of traders lose money, this does not appear to be true at all.
It would appear that around 20-30% of people are making money from currency trading, which is a significant number of people. Furthermore you can be sure that some of these people will be making vast sums of money, and may well have built up huge fortunes over the years from the effects of compounding, ie increasing your stakes as your account grows. So overall I would say that there is no reason whatsoever why you shouldn’t be able to join this elite group of traders.