For more details go to www.fintrader.net

The Winners and Losers

of the Zero Sum

Game

Trading is a zero sum game when measured relative to underlying fundamental values.

No trader can profit without another trader losing.

People trade because they obtain external benefits from trading. Many that hold spread betting and futures accounts do so for gambling entertainment and not to make money. Taken from the study done by Lawrence Harris, May 7

1993. Full report can be downloaded at http://www.thefinancialtrader.net/winners.pdf

Less is more – the 80/20 rule - Vilfredo Pareto

80% of land wealth in Italy was owned by 20% of the population

80% percent of his peas were produced by 20 percent of the peapods

80% of you business comes from 20% of your customers

80% of the website traffic comes from 20% users

20% of a meeting provides 80% of the results

80 percent of the errors and crashes in Windows and Office are caused by 20 percent of the entire pool of bugs 3

1848- 1923

80/20 Rule In Financial Trading

80% of our profits comes from 20% of our trades

80% (and more likely 90%) of the techniques, indicators, financial data is worthless

80% of the gains in a financial market come from 20% of the time

80%+ of traders do not make money/break even, 20% of traders make massive profits

The 80/20 RuleHow I can teach you to be a successful trader in a short

period?By concentrating our efforts on the most important 20% of the subject. Also REMEMBER, I have done a massive amount of preparation, produced tools and systems for you, so it’s like having a ready made meal.

All trading whatever it may be - the stock market, commodities, currencies, the art

market, property market or classic car market, are driven by two elements:

GREED So often, investors get caught up in greed (excessive desire). After all, most of us have a desire to acquire as much wealth as possible in the shortest amount of time. The internet boom of the late 1990s is a perfect example.

FEAR ("an unpleasant, often strong emotion, of anticipation or awareness of danger"). When stocks suffer large losses for a sustained period, the overall market can become more fearful of sustaining further losses. But being too fearful can be just as costly as being too greedy. End of 2008 to March 2009 was a good example.

Greed and Fear at its best, Trading the pyramid scam

.

Greed and Fear at its best, Trading the pyramid scam

A Complete Price Cycle

Disbelief

Belief

Total Belief

Disbelief

Belief

Market bubbles always end the same way

Market bubbles always end the same way