In the US, most active fund managers fail to outperform the market. In fact, over 75% of the fund managers in the US tend to underperform the index fund, which is index funds are so popular in the West. Why do you think that index funds perform better than most of the fund managers in the US? It is estimated that more than 75% of the active fund managers tend to underperform the index. That is because the market represents the collective wisdom of a large number of traders and is therefore better equipped to deal with news flows. This is a risk that fund managers with long term perspectives can still afford to take.

But as a trader with short term perspective, you need to be humble enough to admit that the market knows best. The smart trader is one who is able to read the story of the market and trade accordingly. When you are trading against the market momentum, you are actually taking on an additional risk. When you take on additional risk your risk-return trade-off gets skewed against you. That means; you are more likely to lose money in the trade. Learn to trade within the limits imposed by the market and never try to outsmart the market. The moment you try to outsmart the market you are out on a wild goose chase.