Smart money vs Dumb money in Stock market

Smart money vs Dumb money in the Stock market

Smart money is known as professional traders and dumb money is known as retail traders.

How Professional Traders works

1. Professional traders know how the financial market works
2. Smart money understand that conflict of interest exit
3. They know the stock market is a zero-sum game
4. They analyze and predict the future price by calculation
5. Exchanges main source of earning is from the professional traders - investment bank - pension funds they work all together.
6. Exchanges and professional traders work together  
7. Investment bank provides the leverage to the brokers
8. Broker help to bump all stocks to the retail investors  and provide exit routes to the professional traders
9. Broker and the professional traders work together against the retail investors
10. Professional traders don't listen to any tip or advice. They trade based upon their analysis
11. They trade the opposite way the retail trader's trade
12. Professional traders don't chase the stock price 
13. Hedge funds and pension funds own 90% of the trading 
14. They control the market and the broker 

How Retail Traders works

1. They don't know the working principle of the stock market
2. Retail traders repeat the same mistakes over and over
3. All professional traders and brokers know 90-90-90 phenomena of retail traders
4. Professional traders and broker says 90% of the retail traders lose their 90% capital within 90 days.
5. Lack of risk management, Using high leverage while trading
6. Not calculating the position size based upon the capital
7. Not calculating the risk-based upon the capital
8. Bad risk and reward ratio
9. Book high losses and small profits
10. Retail traders follow the tv anchors and tips and tricks 
11. Retail traders learn the standard rules of the stock market but they don't know is that these rules built by the professional trades to provide them a way of entry or exit in the market
12. Retail traders chase the stock price and fall in the trap 
13. Broker encourage the retail investor's trade as big as possible, the earn more when retail traders trade big account and lose money
14. Broker and retail investors have a conflict of interest
15. The stock market educator works with brokers and earns commission 
16. Retail traders take training from  these educators 
17. When retail traders start trading after getting training 
18. Retail traders start to lose money because the educator works with broker and broker take the opposite trade of retail traders and earn profits
19. Learn how industry work and then trade
20. Do your own analysis and then trade
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