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> On Kalshi, too, losers vastly outnumber winners. Spokeswoman Elisabeth Diana said there are 2.9 unprofitable users for each profitable one based on data from

> On Kalshi, too, losers vastly outnumber winners. Spokeswoman Elisabeth Diana said there are 2.9 unprofitable users for each profitable one based on data from the past month So 25% of users are profitable? That's vastly more than on financial sites - stocks/futures/forex/options trading where only 5% of bettors are profitable.

hiddencost 6mo ago
Uhm, I'd like to introduce you to our Lord and Savior index funds. Simply buy vtsax and forget for 30 years.
- lenerdenator 6mo ago
  [flagged]
- hnthrow0287345 6mo ago
  Maybe switch to European markets? Significantly more uncertainty and less stability around the US.
boh 6mo ago
All those other markets are vastly bigger in scale and trade in trillions on a daily basis so it's an irrelevant comparison. Also the expectation is that the majority of that 25% are insiders. So you're comparing catching fish in a barrel where 25% of the participants hooked the fish prior to you getting a turn vs fishing in the open ocean (so 5% is pretty good with additional voting rights/tax benefits).
JumpCrisscross 6mo ago
> vastly more than on financial sites - stocks/futures/forex/options trading where only 5% of bettors are profitable Source? I'm not doubting that there are products and forums where 95% of traders lose money. But that's far from representative for most financial-market participants.
- dist-epoch 6mo ago
  10 year old paper on forex trading. 85% of losers here. > The average trader is in the dataset for almost exactly six months (181 days). This is the amount of time between a trader’s first and last trade. About 25% of traders leave the sample within the first 46 days, while 50% of traders exit the sample within 155 days. Of the 181 days on average between open and close, traders are actively trading on an average of 50 of those days. The average trader has an equal-weighted return per trade of -0.035%, and very few traders quit while ahead. That traders have such small average returns per trade is not surprising given that the median trade is open for only 16 minutes, as can be seen from Panel B. Only 16.2% of traders are profitable upon exiting the sample. https://www.nber.org/system/files/working_papers/w22146/w22146.pdf https://www.nber.org/system/files/working_papers/w22146/w221... It's well known in the industry that about 90% of traders drop before 1 year. > But that's far from representative for most financial-market participants. I specifically mentioned "bettors" - day traders/speculators, not long time investors. Two different segments.
  - JumpCrisscross 6mo ago
    > specifically mentioned "bettors" - day traders/speculators, not long time investors Forex is zero sum before fees and negative sum after. It’s distinct from capital markets. I wouldn’t extrapolate losses from FX.
    - dist-epoch 6mo ago
      It's the same loss percentage for stocks day trading. The loses do not come mainly from the zero sum/fees, they come from the lack of alpha. > Depending on the source, only around 3% to 20% of day traders make money. But that 20% estimate probably has as much to do with the time period studied—the dotcom bubble. It's hard to know for sure, but it's probably fair to say that up to 95% of day traders lose money. https://www.investopedia.com/articles/active-trading/053115/average-rate-return-day-traders.asp https://www.investopedia.com/articles/active-trading/053115/...
      - 6mo ago
rybosworld 6mo ago
Are you confusing beating the market with being profitable? The majority of active traders won't beat the market (e.g. the S&P 500). That doesn't mean they aren't profitable.

hiddencost 6mo ago

Uhm, I'd like to introduce you to our Lord and Savior index funds. Simply buy vtsax and forget for 30 years.

lenerdenator 6mo ago
[flagged]
hnthrow0287345 6mo ago
Maybe switch to European markets? Significantly more uncertainty and less stability around the US.

boh 6mo ago

All those other markets are vastly bigger in scale and trade in trillions on a daily basis so it's an irrelevant comparison. Also the expectation is that the majority of that 25% are insiders. So you're comparing catching fish in a barrel where 25% of the participants hooked the fish prior to you getting a turn vs fishing in the open ocean (so 5% is pretty good with additional voting rights/tax benefits).

JumpCrisscross 6mo ago

> vastly more than on financial sites - stocks/futures/forex/options trading where only 5% of bettors are profitable Source? I'm not doubting that there are products and forums where 95% of traders lose money. But that's far from representative for most financial-market participants.

dist-epoch 6mo ago
10 year old paper on forex trading. 85% of losers here. > The average trader is in the dataset for almost exactly six months (181 days). This is the amount of time between a trader’s first and last trade. About 25% of traders leave the sample within the first 46 days, while 50% of traders exit the sample within 155 days. Of the 181 days on average between open and close, traders are actively trading on an average of 50 of those days. The average trader has an equal-weighted return per trade of -0.035%, and very few traders quit while ahead. That traders have such small average returns per trade is not surprising given that the median trade is open for only 16 minutes, as can be seen from Panel B. Only 16.2% of traders are profitable upon exiting the sample. https://www.nber.org/system/files/working_papers/w22146/w22146.pdf https://www.nber.org/system/files/working_papers/w22146/w221... It's well known in the industry that about 90% of traders drop before 1 year. > But that's far from representative for most financial-market participants. I specifically mentioned "bettors" - day traders/speculators, not long time investors. Two different segments.
- JumpCrisscross 6mo ago
  > specifically mentioned "bettors" - day traders/speculators, not long time investors Forex is zero sum before fees and negative sum after. It’s distinct from capital markets. I wouldn’t extrapolate losses from FX.
  - dist-epoch 6mo ago
    It's the same loss percentage for stocks day trading. The loses do not come mainly from the zero sum/fees, they come from the lack of alpha. > Depending on the source, only around 3% to 20% of day traders make money. But that 20% estimate probably has as much to do with the time period studied—the dotcom bubble. It's hard to know for sure, but it's probably fair to say that up to 95% of day traders lose money. https://www.investopedia.com/articles/active-trading/053115/average-rate-return-day-traders.asp https://www.investopedia.com/articles/active-trading/053115/...
    - 6mo ago

rybosworld 6mo ago

Are you confusing beating the market with being profitable? The majority of active traders won't beat the market (e.g. the S&P 500). That doesn't mean they aren't profitable.