Part 5/8:
Trading venues are engineered for the majority to lose money. Insidious practices like high commissions and slippage exacerbate the struggle of amateur traders. For many, the financial system is designed with traps, slowly draining funds while the inexperienced navigate its complexity. Commissions can account for a significant portion of losses, often underestimated by beginners who dream of large returns without understanding the cost of entry and exit.
The author outlines how even small commissions can dramatically impact profitability. He emphasizes a nuanced understanding of trading costs—comparable to the expenses incurred in running a business—and advocates for diligent cost management and finding the best broker deals.