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Isn't day trading a zero-sum game? If so, it's not very surprising that the majority of day traders lose money. Every dollar you make comes from someone who l
by grondilu 10y ago
Isn't day trading a zero-sum game? If so, it's not very surprising that the majority of day traders lose money. Every dollar you make comes from someone who lost it. So unless you have a competitive advantage, such as lower brokerage fees, you should stay away.
Me, I believe in https://en.wikipedia.org/wiki/Buy_and_hold https://en.wikipedia.org/wiki/Buy_and_hold. The money you'll make will come from the actual profits of the companies.
- cortesoft 10y agoIt isn't zero sum.... the stock market has, at least so far, gone up over time; so on average, the sum of all money made on the stock market each day is positive. This means it is possible for everyone to 'win' and gain money. Fighting over that 'gain' for each day, however, is zero sum.
- neffy 10y agoNo, actually it's not. If you take the amount of money involved in the stock market every year, and assume that as a percentage of the total amount of money sloshing around the economy it remains broadly the same, then owing to monetary expansion (~7-8% a year in the USA), there is that percentage to be extracted from the financial system every year. Which Wall Street is quite efficient at. If you factor in things like financial feedback loops essentially acting to concentrate money over long periods of time in the financial sector (well, what did you think was causing the ever increasing wealth gap?), then it's a little more than that of course.