I received the following email from reader Ed:
I hope you’re doing great and all is well by you. I was wondering if I could run something past you if you don’t mind. I was the trader that Dr. Brett mentioned in his March 14 article, “the mistakes traders make.” I was wondering if you would mind telling me what the win rates at your firm look like. What is such a struggle for me is knowing where I stand relative to the time I have been doing this, which is less a bit less than two years. The toughest question that I ask myself is “how am I doing at this point?” Thx so much for your response, I really appreciate it.
Ed, terrific questions and great job working on your trading game! This effort illuminates how well you are probably doing and will do. Dr. Steenbarger is the ultimate source for trading advice so maybe we can get him to respond as well. He still responds to my emails so I will try and coax him into a blog response as well :).
Every trader has a different win rate. This depends on your trading style. A micro-scalper will have a very high win rate of perhaps 80 percent. A trader who focuses on Trades2Hold, longer-term intraday trades, may have a thirty percent win rate. Both can be exceedingly profitable.
Also your win rate will vary depending on the time of the day and time frame. My win rate is best on the Open and worst midday. A short term trader will have a higher win rate than a longer term trader.
What your win rate ought to be or how well you are doing might be dissected with these questions: When you review your trades are there set ups that make the most sense to you, that you have made your own? How can you make more of them? Are there trades that statistically do not work for you? GMan religiously keeps stats on what is working for him. He tweaks his trades depending on his stats. Some trading periods he focuses on micro-scalping and others Trades2Hold. He lets his stats lead the way. And now he is a Partner!
Make more of the trades that work best for you and get rid of the ones that are not working.
Thanks for your question.