Do 90% of Traders Really Lose Money? What the Data Shows

Almost everyone who researches trading runs into the line: 90% of traders lose money. It shows up in videos, courses and conversations, almost always without a source. The exact number varies by study, but the underlying conclusion keeps repeating: among retail traders operating short-term, losing is the most common outcome.

This article looks at where those numbers come from, what they actually measure and, with an example calculated on real bitcoin prices, why position size explains a large part of the wiped-out accounts.

Where the 90% number comes from

There is no single study that measures every trader in the world. The number circulates because several surveys, done in different markets and periods, arrive at similar percentages, always within specific groups: retail traders, short-term trades and, often, leveraged products.

Brazil: day trading the mini-index

The most cited study in the country comes from researchers at FGV and USP (Chague, De-Losso and Giovannetti, 2019), who analyzed every retail trader who day-traded mini-index futures on B3 between 2013 and 2015. Among those who kept trading for more than 300 sessions, 97% lost money. Only 1.1% earned more than the equivalent of a minimum wage.

Europe: CFDs

In 2018, ESMA, the European securities regulator, reported that between 74% and 89% of retail investor accounts in CFDs (leveraged contracts on asset prices) tend to lose money. Since then, brokers regulated in the European Union have been required to show, in their ads, the percentage of retail accounts that lose money with them.

Taiwan: day traders

Studies by Barber, Lee, Liu and Odean using complete data from the Taiwan stock exchange found that fewer than 1% of day traders manage to profit consistently after costs.

In other words: the 90% figure isn't exact, but it isn't an exaggeration either. In some groups, reality is worse.

Why most traders lose

• Risking too much per trade: just a few losses in a row can already wreck the account.
• Leverage: it amplifies both gains and losses; a normal price move can wipe out the account.
• Costs: commissions, spread and taxes weigh more the more you trade.
• No tested plan: entering the market without having tested the strategy beforehand.
• Emotional decisions: raising risk to make up for losses, moving the stop, exiting winners too early.

Real example: position size in bitcoin

The chart shows bitcoin (BTC/USDT on Binance) from April 1 to October 7, 2026, with the 14-day ATR, which measures how much the price moves on average per day. On October 7, BTC closed at US$ 83,321.81, with an ATR of US$ 2,187.23. Let's compare two traders with the same US$ 2,000 account and the same stop, at 1.5 × ATR, or US$ 3,280.85 from the entry price.

Trader A: risks 1% per trade

• Risk: 1% of US$ 2,000 = US$ 20.
• Position: 20 ÷ 3,280.85 = 0.0061 BTC, about US$ 508 of exposure.
• After five losses in a row: 2,000 × 0.99 raised to the 5th power = US$ 1,901.98. The account dropped 4.9%.

Trader B: risks 20% per trade

• Risk: 20% of US$ 2,000 = US$ 400.
• Position: 400 ÷ 3,280.85 = 0.1219 BTC, about US$ 10,159 of exposure, more than five times the account. Only possible with leverage.
• After five losses in a row: 2,000 × 0.8 raised to the 5th power = US$ 655.36. The account dropped 67%.

What bitcoin actually did

From the high of US$ 82,850 on May 6, 2026 to the low of US$ 57,800.19 on July 1, BTC fell 30.2%. With exposure of five times the account, a 20% drop alone would have been enough to lose 100% of the capital. Trader B wouldn't have needed to get the analysis wrong five times; being long through just one of that asset's normal drops would have been enough. Volatility also shifted along the way: the ATR went from US$ 2,685.82 on April 2 to US$ 1,226.13 on August 16, and anyone who doesn't adjust position size for that is risking more than they realize.

These numbers describe what happened with bitcoin during this period, not what will happen.

How to use this statistic

As a warning, not a sentence

These studies measure the average behavior of groups. They show which mistakes are most common: poorly sized risk, leverage, overtrading. Avoiding these mistakes doesn't guarantee a profit, but it takes you out of the group that loses for avoidable reasons.

Start small and keep a record

Risk a small fraction of your capital per trade, ideally between 0.5% and 2%, and log every trade. Without a record, there's no way to know if you're improving.

Limitations

Each study covers one market, one product and one period. The Brazilian study covers mini-index day trading; the European one covers CFDs. The percentages don't automatically apply to someone investing long-term, for example. And no risk management eliminates the possibility of loss.

Common mistakes for anyone trying to stay in the 10%

• Thinking the statistic only applies to other people.
• Risking a large share of the account per trade to grow faster.
• Using leverage without calculating total exposure relative to capital.
• Raising risk after losses to try to recover.
• Overtrading and ignoring how much costs weigh.
• Starting with real money without having tested the strategy on demo.

Before risking real money, run the exercise above on a demo account: set a fixed risk per trade, calculate position size using the asset's ATR, and log every trade for a few weeks. If the demo account can't survive the rules, the real account won't survive either.

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