96% of forex traders lose money? The myth has been busted!

upset trader apparently lost money or tired

Find out what are your chances to make money with forex and stock trading and which is the “riskiest” and which is the “safest” broker out there.

For the first time in the history of trading, you get to know the real statistics of how many investors actually make money by trading CFD’s like forex, stocks etc.

One of the most popular questions bothering new forex traders has been “What percentage of forex traders make money?”, “How risky is forex trading?”. There was some speculation, but nobody had significant hard facts. Until now…

Most traders have heard the popular estimate that 96% to 99% of traders lose money. This figure has been circling around for many years, but it was more like a folk legend than a hard fact. There was some data from a couple of brokers, but it was not possible to get the results from all the market participants. But now the secret can be revealed thanks to the new regulations.

With the new European regulations that came into effect from August 1, 2018, brokers are required to display clearly on their marketing message what is the percentage of their clients that lose money. For example: “75% of retail investor accounts lose money when trading CFDs with this provider.”

What percentage of forex traders lose money?

So we decided to gather the statistics from all of the established brokers to get a proper answer on what percentage of forex traders make money. It seems that we are the first ones to publish this information, so you are in the lucky place! 31 CFD brokers were surveyed overall and here are the results:

how many forex and stock traders lose money when trading - different broker comparison

It turns out that the losing account percentage varies from 65% to 89%. And the average percentage of losing accounts is 77%.

Pie chart showing how many forex traders make and lose money

77% of accounts losing money still seems quite a lot, but it is much lower than the folk legend of 96%. So we can say that the myth has been busted! Given the fact that all business activities are risky and that more than 90% of startups fail, this number is not so bad after all.

Who are the winning brokers / trading providers

Now that we know the average losing percentages, let’s find out which trading providers report the lowest rates of losing investor accounts. Here are the Top5:

forex brokers with the lowest rate of losing accounts and traders

As you can see in the image above, eToro stands out from the crowd with the lowest percentage of losing accounts. 65% losing accounts means that 35% of eToro users are profitable. That is 3 times more than the worst performing brokers and almost 9 times more than the folk legend predicted.

What could be the reason behind the high profitability rate of eToro? The main difference of eToro from other trading providers is the possibility to connect with other traders, discuss trading strategies, and use their patented CopyTrader™ technology to automatically copy the trades of successful traders. Apparently, this actually works!

Who are the losing brokers / trading providers

Here are the Top5 brokers with the highest percentages of losing investor accounts:

forex brokers with the highest rate of losing investor accounts

It might be that these brokers attract the least experienced traders and don’t offer them enough learning and training tools.

Here is the full list of trading providers with the corresponding losing accounts:

How many forex traders and investors lose money - full broker comparisonNow you know the true chances of winning in the forex and stock trading markets! Accept that there is no such thing as a free lunch. Winning at forex trading takes work just like anything else.

 

Disclaimer:

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

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