Do 90% of Traders Really Lose Money?

Everyone loves to throw around that scary number—90% of traders lose money. But does anyone ever stop to ask where this number comes from? Honestly, you can google around and find it splattered across trading forums, blog posts, and YouTube videos. But most of the time, it’s just recycled hearsay. There’s no official study stamped by Wall Street saying, “Yep, exactly 90% of you are toast!” Still, there’s a reason this myth hangs around—because trading is tough, and most folks jumping in are unprepared. So, while the number might not be scientifically precise, the lesson is legit: most new traders don’t make it.

Now, before you decide this game is rigged, know this: there’s nothing magical about the number itself. But the problems new traders face are very real—basic stuff like not managing risk, expecting overnight riches, or letting emotions run wild. The market really doesn’t care about feelings or wishful thinking; it rewards focus, patience, and good habits. The good news? None of those things are out of reach if you stop looking for a shortcut and start playing the long game.

• Where Does the '90% Lose' Claim Come From?
• The Real Reasons Most Traders Lose
• How Successful Traders Think and Act
• Practical Steps to Tilt the Odds in Your Favor

Where Does the '90% Lose' Claim Come From?

So, where did the idea that traders lose money 90% of the time actually start? There’s no one official source. It’s more like an urban legend in trading circles, but it didn’t pop out of thin air. Some of it traces back to old brokerage reports, especially from forex and options brokers who have to disclose their client loss rates by law in places like the UK and Australia. In 2023, a bunch of major retail brokers published numbers showing that anywhere from 70% to 82% of retail CFD and forex traders lost money. Not exactly 90%, but close enough to keep the story alive.

Here’s a quick look at actual broker data from last year:

Why do people quote “90%”? For one, it’s a nice round number that sticks. Also, stock trading—and especially day trading—tends to attract complete beginners with high hopes and little research, so the odds get even steeper. Throw in margin, leverage, and a bit of overconfidence, and you start seeing why the stats look rough.

People forget: we don’t really get full stats for every kind of trading, like plain old stock investing vs. forex or options. There’s a big difference between holding Apple for five years and trying to scalp GameStop stock at 2:30 pm. Lots of the “90%” chatter comes from the high-risk side, where losses are way more common. Still, even in regular stock trading, the majority of do-it-yourself traders trail the market or take hits during tough years.

The Real Reasons Most Traders Lose

The truth about why so many traders lose money isn’t that mysterious—it’s mostly about making the same basic mistakes. Platforms like IG and eToro, which have shared data on client performance, show that well over 70% of retail traders end up losing out. Let’s break down exactly why this happens, without any sugar-coating.

First, most people start trading without a real plan. They jump in after seeing someone’s profits on social media but skip the boring stuff like risk management and setting rules. With no game plan, every weird price move becomes a mini panic attack, and that leads to emotional, random decisions.

• Chasing hot stocks or sudden moves without research—basically, FOMO at work.
• Aiming for home runs with every trade, instead of sticking to smaller, smarter gains.
• Ignoring stop-losses because "this one will turn around." Spoiler: most of the time, it won’t.
• Risking too much on a single trade. If one bad move can blow up your account, you’re betting, not trading.
• Letting losers run and cutting winners early—the exact opposite of what works.

Here’s a quick look at what actual broker disclosures show about client losses:

Notice these numbers aren’t quite 90%, but they’re still rough. The real kicker? Most folks never track what works and what doesn’t. They just keep hoping things will “get better.” But hope isn’t a strategy. If you want different results, you’ve got to stop repeating the habits that almost guarantee failure. Traders lose money because they don’t treat it like a skill to be learned and practiced. That’s the honest answer nobody likes to admit.

How Successful Traders Think and Act

If you look at real accounts of profitable traders, you’ll find that they don’t operate on luck or wild bets. They treat trading more like owning a small business than playing a casino game. These people aren’t glued to charts 24/7 hoping for a quick buck. They have routines, rules, and a system they actually stick to—even when it’s boring or tough.

Here’s what stands out about how they work:

• Traders lose money on some trades, but they make sure to keep losses small. They don’t try to win every trade, just to make more on winners than they lose on losers.
• They set a max risk per trade, usually 1-2% of their total capital. Blow enough trades in a row? Their whole account isn’t wiped out.
• They use stop-loss orders, and don’t move them out of hope. If a trade goes wrong, they’re okay walking away and rethinking.
• They track every trade. Seriously—years of trade logs and journals. This helps them spot what works and what’s just luck.
• They don’t obsess over being right; they care about making money over dozens or hundreds of trades. One winner doesn’t make a career, and one loss won’t break them.

Here’s a quick look at habits that set consistent winners apart—stuff backed up by data from a 2023 broker study of over 11,000 retail traders:

Profitable traders also don’t get caught up in hype. They build their own strategy, tweak it as they learn, and aren’t afraid to sit out when the market is weird or confusing. The key thing? Consistency. It’s less about guessing the next big move and more about showing up and following your plan—day in, day out.

Practical Steps to Tilt the Odds in Your Favor

If you want to escape the traders lose money stat, you’ve got to be deliberate about how you approach the market. It’s not just about reading charts or picking a hot stock. It’s system-building, discipline, and a bit of “learn from your mistakes, not your dreams” attitude.

First, start tracking everything. That means every trade, every exit, every bit of reasoning you had at the time. Most of the traders who actually succeed treat their trading almost like a science experiment. Keeping a trading journal forces you to face your patterns—good and bad. Data from Tradingsim in 2024 showed that traders who log and review their trades are 55% more likely to stay profitable after their first year than those who don’t. Pretty wild, right?

Next, don’t just toss money in without setting your max loss per trade. Most successful traders risk less than 2% of their whole account on a single trade. It feels boring, but it keeps you from the classic meltdown where one bad move blows up months of work. This isn’t only talk—firms like SMB Capital require new traders to use strict risk-controls before they see bigger accounts, and most retail prop-shop traders who stick to this last far longer.

Another thing: ditch the “I can get rich on one winner” mentality. Consistency wipes out luck every day of the week. That means having a plan for every trade, not just hoping something works out. Write down your entry rules, exit strategy, and a stop-loss before you hit ‘buy’. If it helps, make a checklist like:

• Did I check the news for stock-moving events?
• Is my risk per trade below 2%?
• Are my entry and exit points clear?
• Is the trade journal ready?
• Am I chasing losses or revenge trading?

Last thing—you've got to keep learning. The market changes fast. Traders who make it a habit to review mistakes, study new setups, and adjust their style survive downturns that wipe out others. Many experienced traders carve out 20 minutes a day just to review charts or dig into a new concept. It's not much time, but it stacks up.

So, successful traders aren’t just lucky—they’re methodical, stubborn about risk, and always sharpening their skills. It’s not glamorous, but it works.