What traders actually earn: read the published figures, not the screenshots

This question usually gets answered with a screenshot of a profitable account. A screenshot proves
nothing: it could be a demo, it could be one good month out of twelve, and it can be edited in three
minutes.

There is a far more reliable source, and its publication is mandatory.

The figure brokers are required to publish

European regulators require every CFD broker to display the percentage of retail client accounts that
lose money, on the home page. That number sits around 70–80%, depending on the broker
and the reporting period.

Read it correctly: it is the share of accounts losing money in the period, not the share of
people who give up. But it is a third-party-mandated figure rather than a self-reported one — and it says
that most retail accounts lose money.

You can verify it immediately: open the home page of any broker with a European licence and look for
the small print at the foot.

Why most accounts lose

Not from getting the direction wrong. Three more realistic reasons:

• Cost accumulates. Trading 20 lots of gold a month at roughly $19/lot in spread is
  $380 a month. On a $3,000 account you need to make more than 12% a year simply to cover
  the fees.
• Position size too large. Most blown accounts are blown by
  entering too big, not by faulty analysis.
• Revenge trading. One loss leading to a larger trade to win it back. It is the
  fastest way to destroy an account, and it is psychological rather
  than technical.

How to set a sensible expectation

Ignore monthly percentage claims. The meaningful calculation starts from capital and risk:

On a $5,000 account, risking 1% a trade, with a 50% win rate and a
1.5 reward-to-risk ratio, expectancy is 0.25% of capital per
trade. At 40 trades a month, that is roughly 10% — before costs.

Subtract cost and what remains is much smaller. And it is a long-run expectation, not a promise for any
given month: ten consecutive losses fall well inside normal probability.

The number you do control

Profit depends on the market. Cost does not — it is the one part you can affect with certainty:

• Choose the right account type for your real
  volume.
• Avoid entering during the hours when spreads
  widen.
• Collect a rebate on the volume you were going to trade
  anyway.

At 20 lots of gold a month and a $12/lot rebate, that is $240 a month — $2,880 a year. It is not
profit; it is cost you did not incur. But it is certain, and profit is not.

A healthier way to read claims

If someone gives you a monthly percentage without the largest drawdown they have been through and the
number of months in the sample, the figure is unusable. Those two pieces of context are what tell you
whether it is skill or luck that has not run out yet.

This article is for information only and is not investment advice. Conditions and fee levels are published by the brokers and can change at any time — check with the broker you actually use. Leveraged forex and CFD trading carries a high level of risk and can cost you your entire deposit.