Is forex gambling?
Jan 17, 2014 at 18:34
Hi Mr JoeDorman. I cannot agree with you when you tell that a profit bigger than 10% in a month means a high risk. For example, in my strategy i usually don't risk more than 2% in a trade. Sometimes i risk somewere around 4-5% in a single trade but not to often and only when i have some clear ''signals'' regarding market directions. I cannot say that this strategy is a winner one (on a long term) , it's to early, but i believe i can improve it so i think it will be one, if isn't already. :)
Cheers!!
Cheers!!
Member Since Aug 30, 2013
325 posts
Jan 18, 2014 at 20:11
(edited Jan 18, 2014 at 20:13)
JoeDorman posted:
Hello,
we will show in a year.
Good luck
Joe
You can clearly see it's high risk from his vey low DD of about 40% few times over lol. It only takes one bar to wipe it out but only GAMBLE what you can afford because let's face it very few or limited make money from forex other than those who set the rules up.
forex_trader_136673
Member Since Jun 28, 2013
852 posts
Jan 18, 2014 at 20:27
One true fact:
On the long run almost for everyone the survival rate drops to zero.
On the long run almost for everyone the survival rate drops to zero.
forex_trader_2825
Member Since Nov 09, 2009
131 posts
Jan 19, 2014 at 12:48
(edited Jan 19, 2014 at 12:56)
Hi Folks,
This topic caught my eye and as Ive been trading and building forex systems for the past ten years for both private and retail applications, and suffered through the learning experience like everyone else has who's gotten this far, I thought my opinion would be appreciated on this thread.
Is forex a gamble ? For most people it is if by the definition of 'gamblers' you mean losers and I use the analogy of a Casino to explain.
'Most folks' walk through the doors with stars in their eyes and dreams of taking the house to the cleaners. But, as we all know Casinos are built on a house of losers and its usually the house taking the gambler to the cleaners.
However, there do exist card counters, they take a mental note of the cards laid out on the table and use their mind to mathematically determine the odds of certain outcomes and bet accordingly. Over time, the benefit of this consistent 'edge' plays out into their favour. They are not 'most folks'.
How it applies in forex trading is exactly the same.
Traders (gamblers with a forex trading habit) need to consistently apply a profitable edge and one that is sufficiently profitable enough to overcome the inefficiencies involved in the FX market, including but not limited to spread and slippage, which eat into the expectancy of a profitable trading edge.
Most folks don't trade with a profitable edge and even when they do, they either don't realize it and discard it on a losing run or can't apply it consistently enough to realize the longer term benefits.
The question that arises next is obvious, what defines a profitable trading edge ? It is one of the single most important questions you should be asking yourself (if you haven't already) and I can but tender my definition as the minimum required standards;
1) greater than 10:1 return to drawdown ratio over a minimum 10 year to date backtest period using fixed lots per trade (which will be problematic/not applicable with systems that use variable pips SL and too much to go into detail about here)
2) tests conducted with realistic spread and volume commiss
3) tests using appropriate data modelling type, ie ticks for tick system bar open for bar open system, bar open systems run on ticks showing very nearly same result as bar open data.
4) minimum 1000 trades sample.
5) minimum 2 pips expectancy and ideally above 3 (net expected profit per trade factoring all winning and losing trades)
6) no martingale grids (although I dont completely rule out such system if designed with equity stop loss which can be hit repeated and recover from over extended period, which I only know of one system)
7) must work on minimum 6 currency pairs meeting all the above mentioned minimum standards
8) must have live fwd history not exceeding previous maximum drawdown or stagnation period (period between new equity highs), which if exceeded the system can be said to have failed.
That's what determines a profitable trading edge to me and I haven't yet seen a system built to these minimum standards fail by measure of the definition above mentioned. I can also say that I don't often encounter systems that meet these minimum standards either, I know of less than 5 after 10 years in FX and yet that is what 'most folks' seek to make profit with when trading FX. Most (but not all) good systems just never reach retail traders because systems can then be copied, stolen by hackers, distributed and/or otherwise abused.
I favour automated algorithms because at least technology can be consistently applied. The human mode with discretion is prone to failure if for no other reason than lack of consistency. And let's face it, if a system is truly profitable then it can be programmed into an algorithm and shouldn't need human intervention. If a system does not even stand up in a backtest, think about the disadvantage that puts you at out of the box ! Good luck with that because that's what you'll be needing. That's not to be confused with my opinion that an experienced trader can successfully intervene using judgement and improve a systems profitability, but its complimentary - not the difference between profitability and loss stand alone.
Thats my 2 pips worth and I trust it helps you make more informed decisions in FX than 'most folks' do.
Cheers :)
Adam Liddiard
Trading Director
New Millennium Inc
This topic caught my eye and as Ive been trading and building forex systems for the past ten years for both private and retail applications, and suffered through the learning experience like everyone else has who's gotten this far, I thought my opinion would be appreciated on this thread.
Is forex a gamble ? For most people it is if by the definition of 'gamblers' you mean losers and I use the analogy of a Casino to explain.
'Most folks' walk through the doors with stars in their eyes and dreams of taking the house to the cleaners. But, as we all know Casinos are built on a house of losers and its usually the house taking the gambler to the cleaners.
However, there do exist card counters, they take a mental note of the cards laid out on the table and use their mind to mathematically determine the odds of certain outcomes and bet accordingly. Over time, the benefit of this consistent 'edge' plays out into their favour. They are not 'most folks'.
How it applies in forex trading is exactly the same.
Traders (gamblers with a forex trading habit) need to consistently apply a profitable edge and one that is sufficiently profitable enough to overcome the inefficiencies involved in the FX market, including but not limited to spread and slippage, which eat into the expectancy of a profitable trading edge.
Most folks don't trade with a profitable edge and even when they do, they either don't realize it and discard it on a losing run or can't apply it consistently enough to realize the longer term benefits.
The question that arises next is obvious, what defines a profitable trading edge ? It is one of the single most important questions you should be asking yourself (if you haven't already) and I can but tender my definition as the minimum required standards;
1) greater than 10:1 return to drawdown ratio over a minimum 10 year to date backtest period using fixed lots per trade (which will be problematic/not applicable with systems that use variable pips SL and too much to go into detail about here)
2) tests conducted with realistic spread and volume commiss
3) tests using appropriate data modelling type, ie ticks for tick system bar open for bar open system, bar open systems run on ticks showing very nearly same result as bar open data.
4) minimum 1000 trades sample.
5) minimum 2 pips expectancy and ideally above 3 (net expected profit per trade factoring all winning and losing trades)
6) no martingale grids (although I dont completely rule out such system if designed with equity stop loss which can be hit repeated and recover from over extended period, which I only know of one system)
7) must work on minimum 6 currency pairs meeting all the above mentioned minimum standards
8) must have live fwd history not exceeding previous maximum drawdown or stagnation period (period between new equity highs), which if exceeded the system can be said to have failed.
That's what determines a profitable trading edge to me and I haven't yet seen a system built to these minimum standards fail by measure of the definition above mentioned. I can also say that I don't often encounter systems that meet these minimum standards either, I know of less than 5 after 10 years in FX and yet that is what 'most folks' seek to make profit with when trading FX. Most (but not all) good systems just never reach retail traders because systems can then be copied, stolen by hackers, distributed and/or otherwise abused.
I favour automated algorithms because at least technology can be consistently applied. The human mode with discretion is prone to failure if for no other reason than lack of consistency. And let's face it, if a system is truly profitable then it can be programmed into an algorithm and shouldn't need human intervention. If a system does not even stand up in a backtest, think about the disadvantage that puts you at out of the box ! Good luck with that because that's what you'll be needing. That's not to be confused with my opinion that an experienced trader can successfully intervene using judgement and improve a systems profitability, but its complimentary - not the difference between profitability and loss stand alone.
Thats my 2 pips worth and I trust it helps you make more informed decisions in FX than 'most folks' do.
Cheers :)
Adam Liddiard
Trading Director
New Millennium Inc
forex_trader_136673
Member Since Jun 28, 2013
852 posts
Jan 19, 2014 at 16:58
Spread is simply commision, so it is allowed in islam religion. Interest is not allowed.
Member Since Aug 30, 2013
325 posts
Jan 20, 2014 at 01:47
NewMillenniumInc posted:
Hi Folks,
This topic caught my eye and as Ive been trading and building forex systems for the past ten years for both private and retail applications, and suffered through the learning experience like everyone else has who's gotten this far, I thought my opinion would be appreciated on this thread.
Is forex a gamble ? For most people it is if by the definition of 'gamblers' you mean losers and I use the analogy of a Casino to explain.
'Most folks' walk through the doors with stars in their eyes and dreams of taking the house to the cleaners. But, as we all know Casinos are built on a house of losers and its usually the house taking the gambler to the cleaners.
However, there do exist card counters, they take a mental note of the cards laid out on the table and use their mind to mathematically determine the odds of certain outcomes and bet accordingly. Over time, the benefit of this consistent 'edge' plays out into their favour. They are not 'most folks'.
How it applies in forex trading is exactly the same.
Traders (gamblers with a forex trading habit) need to consistently apply a profitable edge and one that is sufficiently profitable enough to overcome the inefficiencies involved in the FX market, including but not limited to spread and slippage, which eat into the expectancy of a profitable trading edge.
Most folks don't trade with a profitable edge and even when they do, they either don't realize it and discard it on a losing run or can't apply it consistently enough to realize the longer term benefits.
The question that arises next is obvious, what defines a profitable trading edge ? It is one of the single most important questions you should be asking yourself (if you haven't already) and I can but tender my definition as the minimum required standards;
1) greater than 10:1 return to drawdown ratio over a minimum 10 year to date backtest period using fixed lots per trade (which will be problematic/not applicable with systems that use variable pips SL and too much to go into detail about here)
2) tests conducted with realistic spread and volume commiss
3) tests using appropriate data modelling type, ie ticks for tick system bar open for bar open system, bar open systems run on ticks showing very nearly same result as bar open data.
4) minimum 1000 trades sample.
5) minimum 2 pips expectancy and ideally above 3 (net expected profit per trade factoring all winning and losing trades)
6) no martingale grids (although I dont completely rule out such system if designed with equity stop loss which can be hit repeated and recover from over extended period, which I only know of one system)
7) must work on minimum 6 currency pairs meeting all the above mentioned minimum standards
8) must have live fwd history not exceeding previous maximum drawdown or stagnation period (period between new equity highs), which if exceeded the system can be said to have failed.
That's what determines a profitable trading edge to me and I haven't yet seen a system built to these minimum standards fail by measure of the definition above mentioned. I can also say that I don't often encounter systems that meet these minimum standards either, I know of less than 5 after 10 years in FX and yet that is what 'most folks' seek to make profit with when trading FX. Most (but not all) good systems just never reach retail traders because systems can then be copied, stolen by hackers, distributed and/or otherwise abused.
I favour automated algorithms because at least technology can be consistently applied. The human mode with discretion is prone to failure if for no other reason than lack of consistency. And let's face it, if a system is truly profitable then it can be programmed into an algorithm and shouldn't need human intervention. If a system does not even stand up in a backtest, think about the disadvantage that puts you at out of the box ! Good luck with that because that's what you'll be needing. That's not to be confused with my opinion that an experienced trader can successfully intervene using judgement and improve a systems profitability, but its complimentary - not the difference between profitability and loss stand alone.
Thats my 2 pips worth and I trust it helps you make more informed decisions in FX than 'most folks' do.
Cheers :)
Adam Liddiard
Trading Director
New Millennium Inc
Care to show us some results to provide us more clear picture and back up what you say. At least 3 years worth of goodies.
Member Since May 06, 2013
11 posts
Jan 20, 2014 at 06:52
'Is forex a gamble ? For most people it is if by the definition of 'gamblers' you mean losers and I use the analogy of a Casino to explain.'
Adam explains it all very lucidly above and I thank him for taking the time to express his thoughts.
As a full time professional 'Gambler' who lives off 'winnings' from Casino's, from Horseracing, from Sharemarket, from Investments, and for the last year from Forex Trading I concur almost exactly with Adam.
The only difference I would make is that there are winning Gamblers and losing Gamblers just like there are winning Fores Traders and there are losing Forex Traders!
In my experience there are about 2% winners from the Casino, 4% from Horseracing and I am not sure of the percentages from Sharemarkets and Investments and after only one year as a Forex Trader using automated bots it is way too early for me to estimate how many Forex Traders might be winners? Perhaps someone more experienced or Adam may like to estimate the percentage winners at Forex Trading?
Mike
Tasmania
Adam explains it all very lucidly above and I thank him for taking the time to express his thoughts.
As a full time professional 'Gambler' who lives off 'winnings' from Casino's, from Horseracing, from Sharemarket, from Investments, and for the last year from Forex Trading I concur almost exactly with Adam.
The only difference I would make is that there are winning Gamblers and losing Gamblers just like there are winning Fores Traders and there are losing Forex Traders!
In my experience there are about 2% winners from the Casino, 4% from Horseracing and I am not sure of the percentages from Sharemarkets and Investments and after only one year as a Forex Trader using automated bots it is way too early for me to estimate how many Forex Traders might be winners? Perhaps someone more experienced or Adam may like to estimate the percentage winners at Forex Trading?
Mike
Tasmania
Jan 20, 2014 at 07:40
The Forex gives a monetary interest to the people investing in it. This interest can be positive or negative, BUT there is a monetary interest.
So the Forex is indeed prohibited, FORBIDDEN, in islam because 'Haram':
https://goo.gl/0VvzeE
So the Forex is indeed prohibited, FORBIDDEN, in islam because 'Haram':
https://goo.gl/0VvzeE
Jan 20, 2014 at 19:02
Hand cutting? Stoning? Hanging? Beheading?
The catalog seems be very large to enforce the word of some oracles.
In fact, it is wiser to leave the Forex that her/his religion, because with the Forex you will ONLY lose your shirt, and you will keep your head on your shoulders.
Quitting some religions can not be so peaceful and your shirt can be repainted in scarlet purple.
On the other hand, there are those who much love the scarlet purple over of the Forex.
Everything is a matter of belief.
And the scarlet purple on a shirt is difficult to clean.
The catalog seems be very large to enforce the word of some oracles.
In fact, it is wiser to leave the Forex that her/his religion, because with the Forex you will ONLY lose your shirt, and you will keep your head on your shoulders.
Quitting some religions can not be so peaceful and your shirt can be repainted in scarlet purple.
On the other hand, there are those who much love the scarlet purple over of the Forex.
Everything is a matter of belief.
And the scarlet purple on a shirt is difficult to clean.
Jan 21, 2014 at 07:21
Here is what quran said:
O ye who believe! Devour not usury, doubling and quadrupling (the sum lent). Observe your duty to Allah, that ye may be successful.
quran 3:130:
https://www.usc.edu/org/cmje/religious-texts/quran/verses/003-qmt.php#003.130
O ye who believe! Devour not usury, doubling and quadrupling (the sum lent). Observe your duty to Allah, that ye may be successful.
quran 3:130:
https://www.usc.edu/org/cmje/religious-texts/quran/verses/003-qmt.php#003.130
Jan 21, 2014 at 09:38
Helas posted:Ironman posted:
Well, a few things need to be corrected at once.
1. There is no God... Not of any kind. If there was, why would he/she/it let the world be the way it is. Forget it. You'll do yourself a huge favour. According to religions there are over 2000+ gods. One more or less will not make any difference.
2. You will NEVER know in what direction a specific market will go. NEVER. If you enter a trade, it can go EITHER WAY. Period.
So, why isn't this gambling?
If you have a good system, try it for 200 trades. (Some will, of course, disagree with this number.) A good system will, on a Risk/Reward-ratio of 1:1 win 55-80% of the trades. (80 is a LOT.)
If your trial gives you anything lower (on a 1:1 RR), leave it be, and try another.
So, about the gambling...
When you look at it on just one trade, it is gambling. But if you have trialled your system correctly, you'll know that when you set a trade, you'll still win about 60 of 100 trades in the long run, but for that one trade, you have no idea. EVER. ;)
No matter what any system seller tells you...
So, why go Average Joe tell you it is gambling when you ask him? Because he has no clue.
If you want to do some trading, trust your own judgement. The average person will have no idea what you talk about.
Cheers and good luck.
/Tomas
I have read your post and found it really nice and [url=https://www.worldwidemarkets.com/wwm/en-us/managementteam.aspx]interesting[/url]. I am totally agree with you and would like to say thanks to you that you share this post here with us.
Any Idea...???
Jan 22, 2014 at 22:01
Well, there is a GOD, we didn't create ourselves. But, for Forex vs Gambling. It's like a Chance vs Risk. Difference? A chance is when you have a well prepared plan to execute something, a risk is when you don't know, or don't have a plan and execute; the hail mary if you will. Luck is no way to explore the Forex world.
Since there is no way to know for sure which way, up vs down, it lies in the fundamentals, the mindset of big money moving the market, and the person trading and the candlesticks reveal everything if you really know how to interpret them. With trading, it's not as difficult as most make it out to be, not easy either; it's all between our ears. Nothing with high reward is.
I know some will say, ohh, coming from a demo guy, well my demo is a copy of my real account, with proprietary copy software i'm testing. I'm not here to impress anyone or find investors, just enjoy the forums and comment occasionally.
Relax and trade your plan
~
Since there is no way to know for sure which way, up vs down, it lies in the fundamentals, the mindset of big money moving the market, and the person trading and the candlesticks reveal everything if you really know how to interpret them. With trading, it's not as difficult as most make it out to be, not easy either; it's all between our ears. Nothing with high reward is.
I know some will say, ohh, coming from a demo guy, well my demo is a copy of my real account, with proprietary copy software i'm testing. I'm not here to impress anyone or find investors, just enjoy the forums and comment occasionally.
Relax and trade your plan
~
"Live The Dream"
Member Since Apr 21, 2013
101 posts
Jan 22, 2014 at 22:35
It's Gambling but we like to call it 'Calculated Risk' 😎
forex_trader_136673
Member Since Jun 28, 2013
852 posts
Jan 23, 2014 at 02:43
I have an idea and I hope I don't offend anyone.
Forex is 'haram' in islam religion because of swaps (interest) and also, when trading is betting, and betting is gambling. Gambling is prohibited by Islam too. So:
1. If you are a bad trader and can't win from the market, quit trading and keep praying for the afterlife.
2. If you are a good trader, quit religion and keep trading. You are on the few side. Mumbo-Jumbo is not for you.
Cheers
Forex is 'haram' in islam religion because of swaps (interest) and also, when trading is betting, and betting is gambling. Gambling is prohibited by Islam too. So:
1. If you are a bad trader and can't win from the market, quit trading and keep praying for the afterlife.
2. If you are a good trader, quit religion and keep trading. You are on the few side. Mumbo-Jumbo is not for you.
Cheers
Member Since Aug 30, 2013
325 posts
Jan 23, 2014 at 02:51
lol
forex_trader_110955
Member Since Feb 06, 2013
61 posts
Jan 23, 2014 at 11:42
Forex is the place where you can learn how to beat the bank :)
