The (Dark) Reality of Stock Trading
0 up · 0 down · 0 ratings
Description
Did you know only 7% of prop trading accounts manage to turn a profit? And of those 7% of traders that do manage to turn a profit, the average return is about 4%. Let that sink in. Because let's say you beat the odds, you're disciplined, you're consistent, and you have an actual edge. You make it into the top few percent of traders who earn that 4% return. But then, at that point, the question becomes, was it worth it? And the answer is overwhelmingly no. Because 4% doesn't just underperform the S&P 500, it underperforms gold, real estate, and even United States treasuries. Meaning you can be a prop trader and stress so hard your hairline needs a trip to Turkey, pay mind-boggling fees, and spend years chasing profitability. Or you can do absolutely nothing, take nearly zero risk, get favorable tax treatment, and earn a comparable yield by just buying US treasuries. So if the odds are this bad, the returns aren't impressive, and the alternatives are objectively Why would anyone do this?
The short argues that prop trading is a high-odds game where only 7% of prop trading accounts manage to turn a profit. It claims that for the small group that is profitable, the average return is about 4%, and asks what happens even if someone beats the odds. The speaker says a 4% return is not only worse than the S&P 500, but also underperforms gold, real estate, and United States treasuries. The argument continues that prop trading can involve heavy stress, mind-boggling fees, and years spent chasing profitability. As an alternative, it suggests taking nearly zero risk, getting favorable tax treatment, and earning a comparable yield by buying US treasuries.
Viewers repeatedly frame prop trading as scam-like or a scheme with rules designed to beat traders, and many argue that passive alternatives are superior. Several comments question the accuracy or framing of the 4% figure, pointing out risks, risk-adjusted comparisons, sample size limitations, and differing personal results across different accounts or periods. Others ask basic clarification questions like “What are props?” while some praise the delivery as serious topics with an unserious, fun tone. A few commenters emphasize that even if 4% sounds small for some, it can be meaningful at larger capital sizes, and some suggest simpler options like high-yield savings accounts or broad index exposure.
Topics · finance · stock market · markets · business · economics
Questions answered
- What percentage of prop trading accounts manage to turn a profit?
- Only 7% of prop trading accounts manage to turn a profit.
- What is the average return for prop trading accounts that manage to turn a profit?
- The average return is about 4%.
- How does a 4% return compare to the S&P 500, gold, real estate, and United States treasuries?
- A 4% return is said to underperform the S&P 500 and also underperform gold, real estate, and United States treasuries.
- What low-risk alternative is suggested to achieve a comparable yield to prop trading returns?
- Buying US treasuries is presented as a near zero-risk alternative with favorable tax treatment and a comparable yield.