BarroMetrics Views: Our Unconscious Motivators

Given the tremendous advancement in understanding how our brain works and the role of emotion, I’d have expected that the ratio of successful traders to unsuccessful traders would have improved since I started trading over 30 years ago. But, looking at the figures, the ratio remains the same - 80% to 90% are long-term losers. And this, despite the fact we went through one of the most sustained bull markets in stocks, gold, and crude oil. That environment should be conducive to trading success but this had not proven to be the case.

Of course, one answer  lies in the unrealistic expectations of each generation of newbies. Relatively few (if any) budding doctors, lawyers, architects would believe that by attending one paid seminar, and/or reading one book and/or attending a series of free previews, they will acquire the knowledge to succeed. But this is not the case with trading. The fact that we are bombarded by hyperbolic claims of easy, quick and meteoric success suggests that the ads work i.e. the purveyors sell enough products to make it worthwhile. On the other side of the equation, the relatively fewer realistic ads would suggest that genuine vendors are less successful.

My experience in Singapore bears out this deduction.

But this factor is not the complete answer; I have met many genuine committed budding traders who have failed. The question is why is this so? In the coming blog or two, I’ll examine why I say: “God may play dice with the Universe”.