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This question concerns the online brokerages that allow a person to open an account to trade in forex, futures, or options.

Here in USA, is there available statistics to show the percentage of account holders that are actually making a profit through trading in of these types of securities?

Note: This would probably be the amount users who have and who do not have a negative balance on their trading accounts. I would think that some numbers like this could provide information about the financial health of these firms (although it could also be used for drawing other conclusions) and for that reason should be of interest to some financial watchdog.

Is there statistics to show the amount of people who are making a profit in e.g. forex vs. futures?

  • Why would the brokerages release this information? What benefit would it serve them? – EkoostikMartin Feb 6 '15 at 16:02
  • @EkoostikMartin, I certainly do not expect them voluntarily disclose much of anything, but government regulations already require them to disclose data. – coderworks Feb 6 '15 at 16:20
  • That would be some deliciously disturbing statistics - I really do hope some government-mandating reporting would allow such an analysis! I just don't know that it exists. – BrianH Feb 6 '15 at 17:12
  • What do you mean by "trading"? Does that include people who buy shares and then sit on them for 30 years? I'm pretty sure 100% of those people are making a profit. – dg99 Feb 6 '15 at 23:34
  • @dg99, the profit on stocks also depends on the company whose stocks they are. Buying Enron in late 1990's and holding onto it would not have led to a 100% profit. Nevertheless I have now removed "stocks" from the question as it looks like a holding of stocks cannot lead to a negative account balance in any case. Thank you for bringing this up. – coderworks Feb 7 '15 at 15:11
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Finding statistics is exceedingly hard, because the majority of traders lose money. That is, not only they don't "beat the markets", not only they don't "beat the benchmark" (S&P 500 being used a lot as reference): they just lose money.

Finding exact numbers, quality statistics and so on is very difficult. Finding recent ones, is almost impossible.

With enormous effort I have found two references that might help make an idea. One is very recent, Forex "centered" and has been prepared by a large finance group for the the Europen Central Bank (ECB). It's available on their website, at an obscure download location. The document is stated to be confidential, but its download location has been disclosed to the public by CNBC. I can't post CNBC's link because I have just joined this Stack Exchange portal so I don't have enough reputation. You can find it by looking for their article about FXCM Forex broker debacle due to the Swiss Central Bank removing the EUR/CHF peg at 1.20.

The second is a 2009-ish paper about Taiwanese retail traders profitability statistics published by Oxford University Press and talks about stocks.

Both documents focus on retail traders.

I strongly suggest you to immediately save those documents because they tend to disappear after a while. We had a fantastic and complete statistics report made by a group of German Banks in 2011... they pulled it off in 2012.

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Interactive Brokers advertises the percent of profitable forex accounts for its own customers and for competitors. They say they have 46.9% profitable accounts which is higher than the other brokers listed. It's hard to say exactly how this data was compiled- but I think the main takeaway is that if a broker actually advertises that most accounts lose money, it is probably difficult to make money. It may be better for other securities because forex is considered a very tough market for retail traders to compete in.

https://www.interactivebrokers.com/en/?f=%2Fen%2Ftrading%2Fpdfhighlights%2FPDF-Forex.php

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It looks like these types of companies have to disclose the health of their accounts to CFTC (Commodity Futures Trading Commission).

That is the gist I get at least from this article about the traders that lost money due to the Swiss removing the franc’s cap against the euro. The article says about the U.S. retail FOREX brokerage:

Most of FXCM’s retail clients lost money in 2014, according to the company’s disclosures mandated by the CFTC. The percentage of losing accounts climbed from 67 percent in the first and second quarters to 68 percent in the third quarter and 70 percent in the fourth quarter.

Side note: The Swiss National Bank abandoned the cap on the currency's value against the euro in mid-January 2015. But above paragraph provides data on FXCM’s retail clients in 2014. It could consequently be concluded that, even without "freak events" (such as Switzerland removing the franc cap), it is more likely for an investor to NOT make a profit on the FOREX market. This is also in line with what "sdfasdf" and "Dario Fumagalli" say in their answers.

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