If you visit brokers websites, you will notice that many of them will have a big paragraph at
the bottom with light grey text that will be smaller than an Ant. On some pages, there
will be a line that will say something like "73 percent of retail accounts lose money
with this broker". "87 percent of traders lose money with this broker". I created the
Trading Rush Channel in January 2020, so it has been almost a year now, and during this
time, I have tested many trading strategies 100 times to find their win rates and to see
if they actually work or not. According to brokers, almost 90 percent of retail traders
lose money, and over the year, I have seen comments that say something like "you will
blow up your account with trading indicators, price action is the king". Well in this video,
since we have real data from the 2500 trades I have taken over the year, why don't we find
out what actually makes money and what blows up your accounts. Before that, remember to
subscribe to the Trading Rush Channel and ring the notification bell, because we test
strategies 100 times to find their win rates, and you don't want to miss that.
If we plot the approximate win rates of almost all trading strategies we have tested in the
last year, you will notice that most of them made a profit. The win rates were as high
as 62 percent, and as low as 35 percent. Now remember, all the indicators were tested with
a 1.5 to 1 reward risk ratio, so any win rate higher than 40 percent, will make money in
the long run. The good strategies with excellent win rates, made profits as high as 5000. But
the worst strategy we have tested on this channel, only made a loss of -1250. Now let
that sink in for a moment, the worst strategy we have tested on the Trading Rush Channel,
only made a loss of -1250. The starting account size in the Trading Rush App was 10000. So
the strategy with the highest win rate, made a profit of 50 percent, but the worst strategy
only made a loss of approximately negative 10 percent. According to our data, indicator
strategies are not the reason for blown up accounts. Let's be honest, many beginner traders
will blow up their accounts way before taking 100 trades with the same strategy. And for
those who say "indicator strategies don't work and price action is the only king", indicators
are calculating their data using the same past you are seeing with your eyes. There
are advantages of trading with price action only and there are disadvantages as well.
Similarly, there are advantages of using indicators, and there are disadvantages as well. Let's
say you wanted to check someone's temperature, do you use a thermometer to get an accurate
reading, or do you put your finger in their mouth and say "yeah that's hot".
Trading indicators shine when it comes to finding the strength of a trend, set a stop
loss by taking volatility into consideration, etc.
Indicators and Price Action trading are both useful, so you why not combine both and
create a perfect trading strategy? But if strategies work and give very high
win rates like we saw on the Trading Rush Channel, why do people blow up their accounts?
If we look at the losing strategies in our data, we can say that the only time someone
is going to blow up their accounts, is when they take around 1000 trades with the worst
trading strategy we have tested yet. But like I said before, most people are not going to
use the same strategy if it doesn't make any money even after 100 trades. Most strategies
do make money after 100 trades. So another possible answer can be "not using a proper
risk management technique". All the strategies I have tested on the Trading Rush Channel,
used a 1 percent of their total account balance per trade. Now there are strategies where
1 percent per trade rule is really unnecessary, because the win rate is very high. There
are strategies I use in the stock market, that don't require me to use 1 percent of
the account per trade, because the win rate is more than 80 percent. These strategies
are only profitable if you have a bigger account, and want to grow it by only 20 to 30 percent
in a year. If you have watched some trading guru make consistent profits, they are probably
using these strategies, because there is no reason to not use them if you have a bigger
account. I will talk about these strategies in the future videos once I'm done with the
basics, because complicated strategies will require you to understand how the stock market
works, money management, probability, and how derivative prices are calculated. Maybe
subscribe and ring that notification bell to see that.
Bad risk management is the problem that leads to blown up accounts, but lack of basic knowledge is
also a big reason. These numbers look really good right? Many strategies have more than
50 percent win rates even with a 1.5 to 1 reward risk ratio. But still, some are getting
lower win rates, while some are getting excellent results. If you have watched other videos
on this channel, and are getting lower win rates, try to take one trade at a time, and
don't take multiple trades at the same time. When I tested strategies, I took one trade
at a time. Forex pairs move in a similar pattern because of forex correlation. Indicators will
give entry signals at almost the same time on multiple pairs. And if you take trades
on multiple forex pairs at the same time, and if one trade is lost, the probability
of losing multiple trades in a row is high. People don't see this and blame the strategy
for not working.
If you know this and are still losing money, try to take one or two trades a day. When
I started trading, I was taking many trades in a short period of time. If one is lost,
immediately look for the next one. As a beginner trader, a winning trade will not affect your
decision, but a losing trade will. At the beginning when I was losing money in trading,
it was not because of a bad strategy, it was because I had found a profitable strategy,
but losing trades were affecting my next decisions. You see, when you are in profit,
you will properly analyze the next trading setup, for example if the price is in a range
or not. But once you lose as a beginner, your main focus will be to recover the loss. Furthermore,
if you take revenge trade in a bad market, you can lose multiple trades in a row. To
avoid this problem, I decided to stick with 1 or 2 trades a day, with a goal of being
in profit by 2 trades at the end of the week. And since then, I haven't made a big loss
in a single day. And if you have been following Trading Rush on Patreon, you probably noticed
that I still stick to the rule I created years ago.
Now, I understand that taking 1 trade a day is not ideal for everyone, especially if you
have a smaller account and want to grow that quickly. But if you have a decent size account
and want to grow your bigger investments, here's how I trade the stock market for more
consistent profits. Pause to read it. And That's all. The video went kind of off
topic, but I hope you learned something. Like the video if you liked it, subscribe and ring
that notification bell for more videos, and to see win rates of more trading strategies.
Maybe support the channel on Patreon and see in depth trade analysis. And thanks for watching.