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Is the sky the limit or is it too good to be true?

  • Post #1
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  • First Post: Nov 23, 2006 9:44am Nov 23, 2006 9:44am
This is a question for seasoned FX veterans or those with at least a few years of live trading experience:

After nearly 6 months of demo and live trading it seems to me that the key to creating monetary wealth from FX is consistency. I.e. if you can consistently be profitable and pull in the pips week in week out, then what stops you gradually increasing your lot sizes? This in turn should mean that it is possible to build a small fortune in only a few years.

Or am I missing something here? Are there some barriers to riches I am not aware of? Let's assume the trader keeps his emotions under control, executes a trading plan consistently. What could prevent this trader from becoming rich?

I guess, the answer I am hoping is nothing will stop you in that case

Thanks in advance!
Consistency and patience is everything
You didn't mention over confidence, or maybe you classify it under the emotions area...


Thanks,

Nader
Quoting Geldmeister
This is a question for seasoned FX veterans or those with at least a few years of live trading experience:

After nearly 6 months of demo and live trading it seems to me that the key to creating monetary wealth from FX is consistency. I.e. if you can consistently be profitable and pull in the pips week in week out, then what stops you gradually increasing your lot sizes? This in turn should mean that it is possible to build a small fortune in only a few years.

Or am I missing something here? Are there some barriers to riches I am not aware of? Let's assume the trader keeps his emotions under control, executes a trading plan consistently. What could prevent this trader from becoming rich?

I guess, the answer I am hoping is nothing will stop you in that case

Thanks in advance!
i think the 'sky's the limit' applies to everything in this life, not just trading.

If you believe that you can succeed and you put in the effort and heart into something, you will get something out of it
Working towards CME membership
The only barrier to success is in the mirror.
In trading, there is no bullshit. You either make money or you don't.
Quoting Geldmeister
After nearly 6 months of demo and live trading it seems to me that the key to creating monetary wealth from FX is consistency. I.e. if you can consistently be profitable and pull in the pips week in week out, then what stops you gradually increasing your lot sizes? This in turn should mean that it is possible to build a small fortune in only a few years.
I am not an experienced trader, but the answers I have read and heard is that almost all good systems seem to deteriorate after a while. Systems are only "consistent" for some time. How long? I wish I knew.
Quoting mrgreen
The only barrier to success is in the mirror.
Excellent quote, well said.
Binary Options Trader
Quoting JosTheelen
I am not an experienced trader, but the answers I have read and heard is that almost all good systems seem to deteriorate after a while. Systems are only "consistent" for some time. How long? I wish I knew.
Trading methods do not break down themselves, instead, they only work under certain market conditions.
Binary Options Trader
Quoting Geldmeister
This is a question for seasoned FX veterans or those with at least a few years of live trading experience:

After nearly 6 months of demo and live trading it seems to me that the key to creating monetary wealth from FX is consistency. I.e. if you can consistently be profitable and pull in the pips week in week out, then what stops you gradually increasing your lot sizes? This in turn should mean that it is possible to build a small fortune in only a few years.

Or am I missing something here? Are there some barriers to riches I am not aware of? Let's assume the trader keeps his emotions under control, executes a trading plan consistently. What could prevent this trader from becoming rich?

I guess, the answer I am hoping is nothing will stop you in that case

Thanks in advance!
You are dead right that the key to profitability is consistancy, both in results (that quest for the smooth equity curve), and in execution, money management and trade management.

In terms of is their a limit as you compound your account, no there is not theoretically, however as you start building your millions, and your positions size increases to such a level, each trade you place starts actually effecting the market to a small degree, you also encounter the issue of finding enough liquidity to close the other side of your trade which means your system will need to change, but that is a long way off for most, but some get there, so why not you.
You can quit and they won't care, but you will always know.
Quoting Yoda_Glenn
Trading methods do not break down themselves, instead, they only work under certain market conditions.
OK, but can you be sure that the same market conditions will come back again and again?
So you say all it takes to build a fortune trading currency is to consistently pull in the pips week in and week out? Thanks.
How you act is more important than how you feel.
Quoting JosTheelen
OK, but can you be sure that the same market conditions will come back again and again?
The market either goes up, down or sideways. Where else can it go? And either your trading method is in touch with it, or it is out of touch with it.
Binary Options Trader
an old addage is "Inch by Inch Its a Sinch" . . .
related to FX i suppose that would be "Pip by Pip Its a Sinch"
Its that consistency thingy again. Take the conservative, well thought out MM and trade model route and the pips should come in (and the MM rules should see increasing lots, wich will equal more account equity).

A fun last week that's for sure!

Happy Trading,
Thom
Quoting Yoda_Glenn
The market either goes up, down or sideways. Where else can it go? And either your trading method is in touch with it, or it is out of touch with it.
That's not what I mean. When someone has a good system, on the long run it will be inevitably become known by other people. But if a system is wellknown, it will stop functioning. Just because other traders (especially the big institutions) will get the profit out of the market before you can do it.
Quoting JosTheelen
That's not what I mean. When someone has a good system, on the long run it will be inevitably become known by other people. But if a system is wellknown, it will stop functioning. Just because other traders (especially the big institutions) will get the profit out of the market before you can do it.
Didn't hurt Warren Buffet or George Sorros any, they made (make) a killing on the Forex.
Binary Options Trader
Warren Buffet, forex? huh? THe only thing I heard was that he betted on dollar strength last year and lost a bundle.

andersenws
"Youth is the trustee of prosperity." - Benjamin Disraeli
i heard warren made a killing in silver.


Jostheleen, where did you learn how to do forex and which system are you using? i'm still learning about all this.

thanks!

S
Quick simulation @ MS Excel

Starting with $ 1,000
Leverage 100:1
Targeted pip a day : 10

With ZERO withdrawal, by month 60 you would have $ 229,000

WIth 20% withdrawal on profit, by month 60 you would have $160,500

This kind of simulations is what is driving me. Of course you will try not to loose 100 pip in an insane day, but fixing those targets above help you when in doubt of "what to do now?"

Hope it has helped
If Warren Buffest lost money it is because he has deep pockets, and can afford to do so (mega stop loss, if any.) Buffet held onto EUR/USD for an extremely long time, it's part of his strategy. I don't know about recent figures, but it is well known that Buffet only made a pretax gain of 448 million with stocks in 2003.....while making 825 million with the Forex. That was in 2003....
Binary Options Trader
Quoting sararinni
i heard warren made a killing in silver.
Jostheleen, where did you learn how to do forex and which system are you using? i'm still learning about all this.

thanks!
S
I am doing stocks for several years, and am now also doing forex. Especially because it is very cheap, low spread and no commissions. I try to develop some systems, based on what I read and hear. Forums like this one and books are very helpful in my opinion.
Quoting andersenws
Warren Buffet, forex? huh? THe only thing I heard was that he betted on dollar strength last year and lost a bundle.

andersenws
He bet on USD weakness.....and aquired only a drawdown, which he had plenty of cash to sit thru.....told his shareholders to be patient
Proper Prior Planning Prevents Piss Poor Performance
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