A successful self trader – Rule # 5
Many brokers and traders talk about their success percent. This is an absolute myth and can mislead you. It hardly matters if your calls were right on 80% of the occasions but your strategy did not treat the winners and losers differently. Secondly, success percent is based on the assumption that all your calls are acted upon. That is impractical. At the end of the day, the performance of the portfolio is what matters!
The myth of success percent
The next time any trader, analyst or dealer talks about the success of calls given please take it with a pinch of salt. In isolation, the success percent is just a mathematical number. It conveys nothing about the ability of the analyst, the skill of the fund manager or the alacrity of a trader. At best, the success percent is a crude measure of success. Let us understand why! Continue reading