What percentage do you have to be right in order to make $$$

[donfede]

Elite horseracing traders can correctly predict maybe up to 80% of the time, if the odds are going up or down?

Only by guessing you are 50% right about predicting if the odds of this or that horse will drift or steam.

And if you are correct 50% of the time you lose money, but if you are brilliant enough to predict correctly up to 80% of the time you make good money...

If this hypothesis is right, When do you break even?

[rubysglory]

For simplicity sake (with disregard to commission), If you are risking 20 units for 100 units profit your running at a ratio of 1:5 to break even. If you are risking 25 units for 100 units profit your running at a ratio of 1:4 to break even . If you lose 50% of your bank in a single bet, you need to make 100% profit to get square. It all relative.

rg

[hgodden]

I would kiss the feat of anyone who could just come to any market and tell 80% of the time whether it will go up or down! I really don't think this is the reality though and is a common misconception from people starting out.

THink about this.... its perfectly possible to be wrong about which direction its going and still make money

[freddy]

Elite horseracing traders can correctly predict maybe up to 80% of the time, if the odds are going up or down?

Only by guessing you are 50% right about predicting if the odds of this or that horse will drift or steam.

And if you are correct 50% of the time you lose money, but if you are brilliant enough to predict correctly up to 80% of the time you make good money...

If this hypothesis is right, When do you break even?

Doesn't really work like that,

someone could only get one trade in ten correct and still make a profit.

Your winning trade ammounts have to outway your losing ones thats all that matters at the end of the day.
Whether your success rate is 90% or 10% it doesn't really matter.

[Euler]

You can pretty much pick and choose your strike rate but it wont deliver profit on its own. You need to know strike rate and the amount you profit per win and loss. From that you can work out if you are +ve.

You could have only a 10% strike rate but earn eleven times your loss to end up overall. It's all down to what you do and why.

[Iron]

I would kiss the feat of anyone who could just come to any market and tell 80% of the time whether it will go up or down!

Luckily for you, I don't think anyone will take you up on that kind offer, although I'm sure there are people who can call the direction of the market with 80% accuracy in certain circumstances!

THink about this.... its perfectly possible to be wrong about which direction its going and still make money

I agree. Ditto with the financial markets.

Jeff

[LeTiss]

I think the % S/R is more relevant for scalpers

Swing Traders can have 1 successful trade and still end up with a profit despite 10 successive losers

[pt9091]

I know someone who can get it right 80% of the time!

[donfede]

and how much does he or she (or you?) earn?

[LeTiss]

I know someone who can get it right 80% of the time!

I don't dispute that at all

The biggest question though is how profitable they are. Having 9 successful trades of £5 each, means jack shit if the next trade resulted in a £50 loss.

[JollyGreen]

I would say it is highly improbable that someone getting it right 80% of the time would then lose everything on the remaining 20%. By definition they are doing something correct and are where they should be. I also do not believe that the "close your eyes" strike rate is 50% or average as I have read here. I would say that 50% is less than average.

I'm pretty certain Peter ran some analysis and the average was around 80%. I am sure he will add his input

[Iron]

Surely that depends on whether they are getting an 80% strike rate through intelligently reading the market, or through having a stupidly high stop loss!

Jeff

I would say it is highly improbable that someone getting it right 80% of the time would then lose everything on the remaining 20%. By definition they are doing something correct

[JollyGreen]

I sometimes wonder why I bother at all. Read what I wrote Jeff. I said it is highly improbable they would lose all of their profit if they get it right more than 80% of the time. I then went on and explained about Peter's analysis.

Quite how someone of your assumed intelligence can then write "that depends on whether they are getting an 80% strike rate through intelligently reading the market, or through having a stupidly high stop loss" is completely beyond me.

[LeTiss]

I would say it is highly improbable that someone getting it right 80% of the time would then lose everything on the remaining 20%.

I'm not sure I fully agree with that JG

Inexperienced traders would be quite excited with such a high strike rate, but inexperience usually brings an inability to cut a bad trade quickly enough. It's quite possible for one bad trade to destroy an afternoon's work

[Iron]

Whoa! Calm down tiger!

I was merely making the point that you can 'get it right' (ie have an 80% strike rate) by having a large stoploss and a small target, without being very skillful.

As for my 'assumed intelligence', let's keep personal comments out of this.

Jeff

I sometimes wonder why I bother at all. Read what I wrote Jeff. I said it is highly improbable they would lose all of their profit if they get it right more than 80% of the time. I then went on and explained about Peter's analysis.

Quite how someone of your assumed intelligence can then write "that depends on whether they are getting an 80% strike rate through intelligently reading the market, or through having a stupidly high stop loss" is completely beyond me.