Who hasn’t dreamed of quitting an unfulfilling day job to make millions in the stock markets by living on wits and reading?

The reality of this dream is much different than you might expect. Living this particular dream is not easy; you can spend 10 hours a day in front of the computer and still lose money.

Trading is not a guarantee of success

Trading is not a guarantee of success. You are the only guarantee of success, and you are the sole person responsible for being a winner or a loser.

The global opinion is that 70% to 90% of people lose in the long run when trading. Of course, as there are so many traders, we are talking about 2 to 7 million traders who profit from the financial markets in the long run. As you can see, it is possible—but it is not easy.

The majority of investors will fail to beat the markets. Why? Lack of knowledge, patience and discipline. Most retail traders don’t know what they are doing, or don´t know anything about the markets, so it is to be expected that most traders will lose in the long run.

The global opinion is that 70% to 90% of people lose in the long run. It is possible to succeed in trading—but it is not easy.

Trading is not a get-rich-quick scheme

Trading is not a short-term endeavor or a get-rich-quick scheme that should be jumped into casually. It requires consistency and hard work.

First, understand what you want to achieve and stay with that goal. If you create a comprehensive plan and remain disciplined with it, there is no reason why you can’t join the list of successful traders.

Trading is not a short-term endeavor or a get-rich-quick scheme.

Is investing in the financial markets gambling?

Many recall the press surrounding the Facebook IPO (Initial Public Offering). The stock made its debut, and people bought shares, believing that this massively popular company would increase their wealth. Then, the stock’s value quickly went down. There were investigations and speculation as to whether foul play was involved.

More recently, we saw the Twitter IPO. The stock seemed to rise before the market even opened, and investors who were holding shares early on profited nicely.

Most people have no explanation for why either event happened; this is because most people are involved in something that they do not understand beyond the most basic concepts of investing. This fundamental lack of understanding leads many to say that investing is a form of gambling.


But is it?


When we invest in something—be it gold bars, stock shares, or antiques—we are essentially placing a bet that these things will go up in value (with some exceptions, such as short selling), or we are working off of some kind of edge that leads us to purchase.
This edge can come from experience, research and proven strategies, and when operating from this perspective, there is very little unknown involved—and thus very little chance, or luck. We are setting forth with preparation that involves a comprehensive understanding of that which we are doing. On the other hand, when a person just "places a bet" with no understanding of why a particular instrument could be worthy of purchase or sales, then it is clearly gambling that relies entirely on chance.

Whether you are betting or investing depends on how you approach the markets.

Skill or Luck

Have you ever wondered whether making money from trading is based on luck or skill?

Most newcomers may not do enough research before attempting to invest in the markets. A lack of research can cause an investor to miss out on potential gains; even worse; it can cause the investor to lose significant amounts of money. Some may feel that successful investors and traders make money because of good luck—but it usually takes more than luck to be successful in today's market.

Historically, only Wall Street insiders have had
access to information about investment opportunities. Nowadays, that is no longer the case, as the Internet is full of information on nearly every publicly traded company. Serious investors can easily research companies and investment opportunities to learn about the long-term risks associated with each investment.

Knowing how to research potential investment opportunities can give an investor an edge. Thorough research can help one invest in solid and reliable companies instead of spending too much time with frequent trades. A reduced number of trades could potentially increase long-term gains.

Luck cannot be depended upon, and rarely comes into play with investments.

Bottom Line

Success in trading is all about obtaining an edge and taking advantage of the opportunity. Luck can come into play on rare occasions, but be sure you understand that luck will not save you in the long-term when trading in the financial markets.

With some research and skill, a person can be successful without having to resort to just luck. Today, the information to make smart investments is easily accessible, making it easier to trade intelligently. Investors and traders may be lucky in the short-term, but skill and knowledge are required to be repeatedly successful over the long-term.

Summary

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The global opinion is that 70% to 90% of people lose in the long run. Success in trading is possible, but not easy.


P

Trading is not a short-term endeavor or a get-rich-quick scheme.


P

Whether you are betting or investing depends on how you approach the markets.


P

You cannot rely on luck.

 

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Comments

maxy
# maxy
Friday, June 6, 2014 3:42 PM
Hi,
this is great site, I wiil try to learn everything and start trading demo account and maybe real
Community Support
# Community Support
Tuesday, June 10, 2014 3:12 PM
Hi Maxy,

Thank you for the positive feedback. A demo account is a great tool to get you acquainted with the financial markets as there is no real money at risk and it is the same as trading with a live account (except for the psychology side of things).

Let us know if you have any questions or if you want to share your trading experiences with others.

Happy trading,

Ximena
 Mobileguru
# Mobileguru
Friday, December 5, 2014 9:19 AM
I second the comments above. I find this site to be very rewarding and the information is fantastic. Thank you!

Stefan
Community Support
# Community Support
Friday, December 5, 2014 1:49 PM
Hi Stefan,

Thanks for your feedback, it´s highly appreciated. I hope you keep enjoying the site and learning from the information that we provide. Stay tuned as we have new articles every week.

Let me know if you have any questions or if I can help you with anything,

Gino

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