Is it easier to lose money on the share market than to win?

Question

Your share costs 100. It goes up by 10%, i.e now 110. If you lose 10% of that you end up with 99.

Another scenario-you lose 10% of 100, it becomes 90, now you gain 10%, you have 99. In either case you lose 1, i.e 100-99.

Does this mean you are more likely to lose on the sharemarket than win?

Answer 1

That's why it is post-crucial to buy a stock at the right time. It's not so much that the probabilities are against you. It's more of a "Pyramid" problem where investors who lie on the bottom of the Pyramid know barely anything about the stock market and basically throw their money in the dustbin. Right at the top of the Pyramid are great investors such as Warren Buffett and George Soros who know how much to buy an investment at (which can be calculated via the Intrinsic Value) and know how much and when to sell it at. That offsets the hurdles which may come in your way.

Answer 2

When you take into account brokerage commissions, then yes it is easier to lose money in the stock market than to make money because on every trade you lose money to your broker whether you make money or not.  So you have to be very careful to not trade too often and to not buy too often during a bear market, which we happen to be in currently.  

Answer 3

Yes.

http://en.wikipedia.org/wiki/Random_walk...

Answer 4

In the scenario given you will be loosing money, but this is not reality.

When you invest/trade in the market one of the first things that you should have in place is a sound money management plan

If you don't have a plan in place you'll never be a profitable investor.

Never invest 100% of your capital at any one time; never invest 100% of you investing capital into any one position.  

And always you stop orders.   If you buy a security, enter a sell stop order 8%-10% below your purchase price or a few cents less than the next support price.   As the stock moves up, you move up you stop order which will protect your profit.

Never get greedy, if the stock keeping hight, keep your stop order closer to the market price.

The idea of investing is not always to make money but also to protect what you have.    Many investors are content in being right in their investment selections 60% of the time, any thing higher than that you can make a very nice living.  

Investors loose money because the don't know what they are doing and never take the time to learn what to do, how to do it and why they are doing it.

Another major reason for loosing money is greed, and lacking discipline to invest smarter.

Answer 5

Answer is yes, especially if you don't know what you are doing.

Why base an argument on figures plucked out of the air??