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Honest truth about forex.....

focusedfinance
Jan 13 2016 at 14:49
14 posts
I disagree on the leverage. Guns don't kill people. People kill people. The same with leverage.

With financial instability and incidents like Alpari I say bring on 2000:1 leverage and thin capitalisation - purely because then more money can stay where it needs to be. In my account. I would rather owe my broker than have my broker owe me.

Also, after many years looking at this I reckon one of the biggest issues for new retail traders is watching too many things. Its like learning to fly a plane blindfolded. Rather learn to fly first - then try figure out how to deal with the blindfold.

Consistently on myfxbook competitions, the average losing trader has 65% winning trades but average loss is double the average gain. I am no statistician, but the coin flip analogy is often used, and coin flips are a 50:50 thing. So fine. Forget everything else, conceptually, flip a coin and you will be right half the time which is less than the 65% wins from trading competitions.

So if you can be right 50% of the time, the key to having edge (or total gains exceeding total losses) is to be able to consistently identify R:R greater than 1:1 because with say average performance of $1.7 of gain for every $1 lost, then 50% win rate or 65% win rate, a trader will be profitable - and no need to follow 1% rules or 3% rules or anything else. Just trade consistent lot size regardless of profits or losses

Edge is edge and a methodology with edge recovers from drawdowns be they 10% or 70%

If you like it, buy it. If you don't sell it.
kieran (snapdragon1970)
Jan 13 2016 at 19:08
1945 posts
Would you let someone drive your porsche that has no driving licence,something my boss used to say for fun.True beginners should stick to one pair.My trades are 60~65% correct,I could even get away with 40% it's all about how much you make on those winning trades to wipe out the tiny losses,most of my trades are 6:1 or 5:1,4:1 minimum,stupid to trade anything less,my entry is more important than exit,I get maximum gain this way.There are many ways but this is mine.

"They mistook leverage with genius".
Patrik (FradeauX)
Jan 19 2016 at 07:59
14 posts
Thanks for your notes. I shall say that entry is also of high importance, especially with news. If you can determine strong signal to entry over time, than you can afford higher leverage and lot size and thus get more profit per trade

FXtrader2010
Jan 19 2016 at 11:01
724 posts
FradeauX posted:
Thanks for your notes. I shall say that entry is also of high importance, especially with news. If you can determine strong signal to entry over time, than you can afford higher leverage and lot size and thus get more profit per trade
entry DOES NOT matter. It has been proven MANY times quantified over and over that you can have a random entry and still be profitable in the long run. It just isn't as sexy as entered on a supply demand level or that moving average crossover.

kieran (snapdragon1970)
Jan 19 2016 at 14:49
1945 posts
Everyone has their own way of trading, Buy the time Moving average cross over kicks in half the trade is over or reversing,signals are only useful some of the time,mostly false or too slow because their depending on past data.

"They mistook leverage with genius".
kieran (snapdragon1970)
Jan 20 2016 at 00:35
1945 posts
focusedfinance posted:
I disagree on the leverage. Guns don't kill people. People kill people. The same with leverage.

With financial instability and incidents like Alpari I say bring on 2000:1 leverage and thin capitalisation - purely because then more money can stay where it needs to be. In my account. I would rather owe my broker than have my broker owe me.

Also, after many years looking at this I reckon one of the biggest issues for new retail traders is watching too many things. Its like learning to fly a plane blindfolded. Rather learn to fly first - then try figure out how to deal with the blindfold.

Consistently on myfxbook competitions, the average losing trader has 65% winning trades but average loss is double the average gain. I am no statistician, but the coin flip analogy is often used, and coin flips are a 50:50 thing. So fine. Forget everything else, conceptually, flip a coin and you will be right half the time which is less than the 65% wins from trading competitions.

So if you can be right 50% of the time, the key to having edge (or total gains exceeding total losses) is to be able to consistently identify R:R greater than 1:1 because with say average performance of $1.7 of gain for every $1 lost, then 50% win rate or 65% win
rate, a trader will be profitable - and no need to follow 1% rules or 3% rules or anything else. Just trade consistent lot size regardless of profits or losses

Edge is edge and a methodology with edge recovers from drawdowns be they 10% or 70%


I like your moto,here's my version. If you like it sell it,if you hate it buy it!

"They mistook leverage with genius".
Charles_F
Jan 25 2016 at 07:40
38 posts
focusedfinance posted:
I disagree on the leverage. Guns don't kill people. People kill people. The same with leverage.

With financial instability and incidents like Alpari I say bring on 2000:1 leverage and thin capitalisation - purely because then more money can stay where it needs to be. In my account. I would rather owe my broker than have my broker owe me.

Also, after many years looking at this I reckon one of the biggest issues for new retail traders is watching too many things. Its like learning to fly a plane blindfolded. Rather learn to fly first - then try figure out how to deal with the blindfold.

Consistently on myfxbook competitions, the average losing trader has 65% winning trades but average loss is double the average gain. I am no statistician, but the coin flip analogy is often used, and coin flips are a 50:50 thing. So fine. Forget everything else, conceptually, flip a coin and you will be right half the time which is less than the 65% wins from trading competitions.

So if you can be right 50% of the time, the key to having edge (or total gains exceeding total losses) is to be able to consistently identify R:R greater than 1:1 because with say average performance of $1.7 of gain for every $1 lost, then 50% win rate or 65% win rate, a trader will be profitable - and no need to follow 1% rules or 3% rules or anything else. Just trade consistent lot size regardless of profits or losses

Edge is edge and a methodology with edge recovers from drawdowns be they 10% or 70%


I agree with your comments, but would like to add one more key element which most of succesful traders have in common: Increasing positive positions and only trail the SL... When to enter a positions is for me completly overated. BTW:

Patrik (FradeauX)
Jan 26 2016 at 07:19
14 posts
FXtrader2010 posted:
FradeauX posted:
Thanks for your notes. I shall say that entry is also of high importance, especially with news. If you can determine strong signal to entry over time, than you can afford higher leverage and lot size and thus get more profit per trade
entry DOES NOT matter. It has been proven MANY times quantified over and over that you can have a random entry and still be profitable in the long run. It just isn't as sexy as entered on a supply demand level or that moving average crossover.


Does or does not, it also depends on strategy, isn't it? For example, two same trades with different entries of lets just say 40 p. It can be noticeable depending on volume. My example was not concretized, you mentioned about long run and I meant some single trade. Thank you and sorry if I m not right after all.

Dave008
Apr 19 2016 at 06:05
4 posts
Do you want to hear honest truth about trading in general?? Its addictive and it gets worse if you make a little bit of money...all of sudden you feel invincible

Money never sleep
kieran (snapdragon1970)
Apr 19 2016 at 15:58
1945 posts
Dave008 posted:
Do you want to hear honest truth about trading in general?? Its addictive and it gets worse if you make a little bit of money...all of sudden you feel invincible


That's because it has the same effect on the brain as coke.This is true until you learn to control your emotions or at least suppress that high.

"They mistook leverage with genius".
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