Average losing streak of day trader? Day trading as career?

sun11

Experienced member
1,474 337
I am interested in day trading. I wish to make it as my career & living out of it. Previously I worked in a prop trading firm where I used to trade Currencies(Forex).

Now, If I convert my career into day trading, I need to have good trading records.
My question is,in general what is the average loosing streak of a day trader in yearly time frame. I mean the bad months.
How many bad months generally a day trader faces before going up again?

If a loosing streak occurs then what the trader does, they change the strategy or keep faith in it?

Can someone really make living out of it? I am seeking answers from those who are full time day traders.

You see lots of people around me doesn't support day trading from home as a career so i really need to know is it possible.

Does day trading from home get counted as job experience?

I know i asked many questions here. But i really need answers for these questions. Please advise.

Thank you
 
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Trader333

Moderator
8,495 881
..what is the average loosing streak of a day trader in yearly time frame..
This all depends on the percentage success rate of the strategy you use and the reward to risk ratio as to how many losing trades in a row you can expect and the likely drawdown of the funds you have.

There is no simple answer without the above information.
 

RStu

Newbie
9 3
sun11...

Trader 333 is right on when referring to win % / risk and reward to help give you a more precise answer.. I will add that equally important is initial account size.

Depending on the strategies, you will find it extremely difficult to trade for a living with less than a 6 figure account.


Here is a cool chart I found some years ago that should provide some assistance..
 

Attachments

Last edited:

Forexmospherian

Legendary member
39,928 3,299
sun11...

Trader 333 is right on when referring to win % / risk and reward to help give you a more precise answer.. I will add that equally important is initial account size.

Depending on the strategies, you will find it extremely difficult to trade for a living with less than a 6 figure account.


Here is a cool chart I found some years ago that should provide some assistance..

Hi RStu

Thank you for printing that chart on win ratios v consecutive loss expectations.

I saw a similar excel spreadsheet ages ago - that I saved on a memory stick and now cannot seem to find it.

If its OK with you I have taken a copy of this one as I would like to use it in a future blog comment I plan to do on the ideal number of trades an intraday trader needs to do to ensure that he can remain profitable on a daily basis.

I am a short term intraday FX trader taking on average 10 to 20 trades a day to achieve my 2 mains targets - ie 1 - not to have a losing day - 2. To achieve a target of 50 pips within a 10 hr time window covering the European and early US sessions.

If I look back over my 16000+ live trades over the past and when I have broken them down into batches of 100 - ie over 5 or 7 trading days - my win ratios have been as low as approx 62% and as high as 87%.

I therefore average out around 72 -75% on an ongoing basis and although I have many days 3 or 4 losses during the day - I have managed to keep under 7 consecutive losses in a session for many years.

The result which will also be interesting to the OP - Sun 11 - is that on easy days when all is going well - I dont even need to take 10 trades to achieve daily target. On really busy days and I am totally focused and in the zone - I might take 17 -20 trades and easily triple my daily target.

However - there will be bad frustrating days - when I have 4 or 5 losses and my wins are small - that I have to take over 15 trades to make a profit - and might not even hit my daily target that session.

Forget about losing weeks - or months - get a trading system / method that allows you to be profitable every session- or even every 4 hrs.

I have not had a losing day for ages - yes last year I had over 35 days I did not make my target - but then a profit is still a profit - whether its $10 or $1000 - and they all add up - never forget that ;-))

I appreciate you do have to be a full time trader - or have full days of over say 6 hrs to be able to carry short term intraday methods out. You dont have to be glued at your screens for a constant 6 or 10 hrs - but saying that when I was at work in my former career for over 25 years - I averaged many weeks 50 -80 hrs - so intraday trading to me is like being part time anyway ;-)

Good Trading


Regards


F
 

jotekfinance

Active member
144 9
I think it might also depend on how much you learned and how intuitive you are as well. :)
 

sun11

Experienced member
1,474 337
I appreciate you do have to be a full time trader - or have full days of over say 6 hrs to be able to carry short term intraday methods out. You dont have to be glued at your screens for a constant 6 or 10 hrs - but saying that when I was at work in my former career for over 25 years - I averaged many weeks 50 -80 hrs - so intraday trading to me is like being part time anyway ;-)
Hello Forexmospherian,

Thank you very much for your input & answers to my questions. That's really very inspiring. I'm glad to meet someone who never had losing day & really made it.

I found a spreadsheet from the net just like the Trader333 & RStu refer, It is attached with the post.

Regards
S
 

Attachments

alan5616

Established member
668 43
Hello Forexmospherian,

Thank you very much for your input & answers to my questions. That's really very inspiring. I'm glad to meet someone who never had losing day & really made it.

I found a spreadsheet from the net just like the Trader333 & RStu refer, It is attached with the post.

Regards
S
My experience of day trading is very different from Forexmospherian. If you're day trading forex, you will have losing days. In the words of Warren Buffett, It's not how much you make when your right; it's how much you lose when you're wrong

I have met many forex day traders over the years. All of them blew their trading accounts, except one. He managed to retain enough of his account to enable him to start day trading DAX futures. He makes a good income from this and would never go back to forex day trading.
 

Forexmospherian

Legendary member
39,928 3,299
Hello Forexmospherian,

Thank you very much for your input & answers to my questions. That's really very inspiring. I'm glad to meet someone who never had losing day & really made it.

I found a spreadsheet from the net just like the Trader333 & RStu refer, It is attached with the post.

Regards
S

Hi Sun 11

I think you have slightly misquoted me

It taken me nearly 11 years of purely FX trading to get to a level of going over a year with no losing day.

For first 6 years - although part time then - I would have losing days and weeks.

After 3 years full time and by this time with over 10k hours of live chart experience on tick and 1 min charts I was 95% able to go over 180 trading days with no daily losses.

Since then - as you might imagine - I have been able to do at least 10 months of the year - as there is between 4 and 8 weeks of the year i dont trade because of holidays.

I am rare . I would say less than maybe 5% of all retail Intraday traders will get to this level - but then again many full time traders have never even taken 2000 live trades - never mind the amount I have.

Most day traders approach it all wrong.

Some only take 1 to 3 trades a day - just not enough - unless there all winners

I would be overtrading if I tried to take over 50 trades in a day over a 10 hr session - but taking 10 -20 trades is well within my system and as long as I stay with a 60% + win ratio and stops under 5 pips - my system works - day in day out - under any conditions


Regards


F
 

sun11

Experienced member
1,474 337
Hello Forexmospherian,

Yes i understand what you meant, experience & practice matters a lot.

I spent 3 years in Forex. First 2 years in part time basis, last 1 year almost full time. I can't call myself a trader because, i am still learning & had many failures. I just wanted to know, is it possible, may be i'm not perfect but can someone really be the best in this field. Because, when i started, most of the people shown negative attitude toward it. That's why your post inspired me.
 

Forexmospherian

Legendary member
39,928 3,299
Hello Forexmospherian,

Yes i understand what you meant, experience & practice matters a lot.

I spent 3 years in Forex. First 2 years in part time basis, last 1 year almost full time. I can't call myself a trader because, i am still learning & had many failures. I just wanted to know, is it possible, may be i'm not perfect but can someone really be the best in this field. Because, when i started, most of the people shown negative attitude toward it. That's why your post inspired me.

They certainly do - and for maybe 3 -5 yrs I never released the importance of time spent watching live charts.

The other important point that I have never read about but is yet again so important is that retail trading with accounts under say $100 -150K is so different to commercial institutional trading with multi million capital accounts.

I originally started full time with over $100 k capital account and used up to 2% for stakes etc. Nowdays - I am happier on a $50 - 70k capital account and with tight stops I can still take trades on up to 10 lots and normally many of my trades are on under 1% stake size

Retail trades - when they are good can do 25 -50% monthly increases with their accounts with no compounding and staying under 2% stake size.

However a commercial trader with a say $10 million or larger account might only used stake sizes of 0.1 % or less and so up to 10 times of more smaller percentage.

Therefore - thats why you get the massive discrepancies of a retail trader say doing a 200% ROR on accounts under $100k and commercial guys only doing 25 -40% per annum on say $20 million.

I too would be very happy with a 25% return on a $20 million account - but on a $20k accounts its really cr*p - for so many reasons etc

Even with a $60 k account and just 10% monthly return - ( and if you can achieve this - don't go fulltime ) is a $6k per month income - OK you might have months at 7% and then other months at 15% or more - until after a few years you start to take advantage of all the skills and tips you pick up on your way.

Hope that all helps


Regards


F
 

sun11

Experienced member
1,474 337
Hi Forexmospherian,

Thank you, that certainly helps a lot. Bigger the account smaller the risk, smaller profit target, Smaller the account bigger the risk, bigger profit target to meet the basics.
So according to you 25% per month return on 50K - 70K account is the standard before I start doing it for full time.

Well then i will keep it as my benchmark. :)
 

Forexmospherian

Legendary member
39,928 3,299
Hi Forexmospherian,

Thank you, that certainly helps a lot. Bigger the account smaller the risk, smaller profit target, Smaller the account bigger the risk, bigger profit target to meet the basics.
So according to you 25% per month return on 50K - 70K account is the standard before I start doing it for full time.

Well then i will keep it as my benchmark. :)

No - 10 - 15% return per month is the standard you need to be at before going full time on a consistent basis - based on over 18 days trading per calender month.

So whilst you are part time - you need to be able to get some full day sessions in and achieve a minimum 2% gains - knowing that for a start you will have a few losing days - that also must be kept under a 2% loss. Then if you base it on only 18 trading days - dont have more than 4 losing days per period. If you have 6 or 7 or more per 18 trading days - then you are still not ready.

Regards


F
 

drtro

Active member
216 21
Now, If I convert my career into day trading, I need to have good trading records.
My question is,in general what is the average loosing streak of a day trader in yearly time frame. I mean the bad months.
How many bad months generally a day trader faces before going up again?


My longest losing streak has been 6 days, so I can't provide input on this. If you have a losing month or year at that, you should really come to accept your strategy isn't working.

If a loosing streak occurs then what the trader does, they change the strategy or keep faith in it?

Once I come into a slump, I cut my size and trade less until I begin doing better. I really don't change much. You aren't going to be 100%. You have to accept that. Don't go changing and tweaking your strategy after every losing trade or day you have.

Can someone really make living out of it? I am seeking answers from those who are full time day traders.

Hundreds of thousands of people (probably millions) trade for a living.

You see lots of people around me doesn't support day trading from home as a career so i really need to know is it possible.

I completely understand. I started trading at 19. My family knew nothing about the stock market and they thought I was crazy for not going to college and becoming some wage slave accountant.

Does day trading from home get counted as job experience?


As long as you're trading real money, I would certainly consider it experience.
 

drtro

Active member
216 21
No - 10 - 15% return per month is the standard you need to be at before going full time on a consistent basis - based on over 18 days trading per calender month.

So whilst you are part time - you need to be able to get some full day sessions in and achieve a minimum 2% gains - knowing that for a start you will have a few losing days - that also must be kept under a 2% loss. Then if you base it on only 18 trading days - dont have more than 4 losing days per period. If you have 6 or 7 or more per 18 trading days - then you are still not ready.

Regards


F
Returns totally depends your capital. If you are trading a $50K account, of course you'd need a huge return. But you are trading $500K you inherited, you could live comfortably off 10% return a year in most places.
 

sun11

Experienced member
1,474 337
Now, If I convert my career into day trading, I need to have good trading records.
My question is,in general what is the average loosing streak of a day trader in yearly time frame. I mean the bad months.
How many bad months generally a day trader faces before going up again?


My longest losing streak has been 6 days, so I can't provide input on this. If you have a losing month or year at that, you should really come to accept your strategy isn't working.

If a loosing streak occurs then what the trader does, they change the strategy or keep faith in it?

Once I come into a slump, I cut my size and trade less until I begin doing better. I really don't change much. You aren't going to be 100%. You have to accept that. Don't go changing and tweaking your strategy after every losing trade or day you have.

Can someone really make living out of it? I am seeking answers from those who are full time day traders.

Hundreds of thousands of people (probably millions) trade for a living.

You see lots of people around me doesn't support day trading from home as a career so i really need to know is it possible.

I completely understand. I started trading at 19. My family knew nothing about the stock market and they thought I was crazy for not going to college and becoming some wage slave accountant.

Does day trading from home get counted as job experience?


As long as you're trading real money, I would certainly consider it experience.
Thank you so much for taking time to answer my questions.
 

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