Why Retail Traders DESERVE TO LOSE Money | Page 2 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Why you lose money and will always lose 44 replies

Why 99% of traders lose money 458 replies

Why do most traders lose money in the market? 102 replies

The reason why 95% of new traders consistantly lose money 203 replies

Real Reasons why Retail Traders lose money 75 replies

Attachments: Why Retail Traders DESERVE TO LOSE Money
Exit Attachments

Why Retail Traders DESERVE TO LOSE Money

  • #21
  • Edited 2:08pm Mar 16, 2019 1:51pm | Edited 2:08pm
Quoting ianf0ster
{quote} Hi Husky, What makes you think I am 'against Retail traders' ? - Did you read post numbers 1 and 2 in this thread? "...things are far more simple then you tend to complicate them." - Really? If trading is so simple, why are there hundreds of threads in here pretending to show people a simple way to trade? If any one of them worked as described (i.e. anybody can learn it and be profitable), then there would be no demand for all the others. "...you never need to pay anyone to teach you trading,you never need a signal,or a robot as a retailer....
well the title of thread i was thinking sound a bit like against those little retailers who lose at daily basis, and i was thinking to this also cos you made it in bold caps more like a statement. but heck english is not my first language and i might get it wrong. anyway...
when i was talking about method then yes ,you are new to forex ok, go read about basic stuff you MUST know before trade real money,get used with those financial stuff and terms around,get used with daily calendar and try to learn what means that and that.
Must know what a NFP day is i guess before to jump in real trading. to develop some early skills and try build up one basic strategy then one demo is enough for start I AGREE . I already mention about PRACTICE.
Later when you accomplished those little tasks yes jump in with real money, is important to use money you dont care about the ones you really really afford to lose COS YOU WILL LOSE, and this loss MUST NOT AFFECT YOUR WAY OF LIFE your equilibrium. and also trading little money is to test if youre psychological ready to deal with DD ,to deal with a losing trade to deal with a profit trade.
If results are still not decent then you still need a lot of work. and just adding new money into account after wiped previous will NOT HELP. will only lead you to lose again cos you might go into trading thinking at recover,this is a huge challenge most of traders have. they lose and start next with recover plan which is something very near to revenge trading and of course will fail.
I said already you dont need to pay for anything to start in this ,stuff like indicators or who knows what crap studies or lessons from any guru idiot who of course cant make money on his own but will make by selling to you his crap lessons. must learn some basics about all this financial stuff how they move ,how ,what and why may move some individual currency ,why they move against each other ,why they are correlated or not. in the end is not big thing but when youre really really new can look like hell of information to acquire. this is why time is needed.
In the end what i dont get it is the real purpose of this thread, but i think we will know it soon. as just simple information to help newbies to STOP dreaming green horses on the walls yes then i agree. but you as me and many others you know already this will not help.
is like when you tell to one casino player ''dont go there cos you lose'' , he knows that already and thats not enough to keep him out ,he is going there just because there is a skinny possibility to win thats the only reason and this create a behaviour in his brain making it hard for him to refrain. as long the goods and all good stuff in life have a price on this planet , humans will always look to gain even with all the risk involved.
Take what you can, give nothing back
  • #22
  • Mar 16, 2019 1:53pm Mar 16, 2019 1:53pm
I will tell you short. A big part of accepted dogmas in forex dont have any solid base or proved objectively. And your conclusions are inside that group. Is not relevant what part.

I think don't use SL is not responsible to kill accounts and you can think I'm wrong. But i can demonstrate it. Can you demonstrate objectively all your conclusions here? Because until now its only your subjective opinion. That is reason i told you that. Its only a constructive critic. I'm coder then facts for me are things i can replicate. And i can't replicate ambiguous ideas or thinking without a proved base

Regards...
Try don't lose pants never...
  • #23
  • Mar 16, 2019 1:54pm Mar 16, 2019 1:54pm
Quoting duxis
{quote} OK If you were only a drunk member passing by ...and expressing his rambling rhetoric, that's fine. But not only you are drunk , you are carrying a commercial intent in your bag, that's a different thing. Sorry i couldn't refrain my hostility. We are both FF senior members , it's a pity to see someone reduced to play the role of the vacuum cleaner salesman. .....
Hi Duxis,
So not only do you think I am drunk, but also selling vacuum cleaners.

- That is very harsh. Especially since I am just an ordinary FF member, who tries to help fellow members.
I am not paid (either for my opinions on the trading education I like), nor for my work with the Self Help Group- still completely free after almost 5yrs!
FF consider me a 'commercial member' merely because I keep telling people about some of the good education available.

I was not actually asking about your style of trading. I really don't think it qualifies as Philosophy.
I was asking about what specific things I have said that you disagree with.

When I have time I will take a look at your Arb 'philosophy'. However I doubt if it is true Arbitrage, rather than Statistical Arbitrage or perhaps just merely 'Value Trading'. Both of which feature in the 'institutional style' education that I am most keen on.
  • #24
  • Mar 16, 2019 2:13pm Mar 16, 2019 2:13pm
Quoting braintheboss
I will tell you short. A big part of accepted dogmas in forex dont have any solid base or proved objectively....
I think we agree there ! In short much 'retail trader education' is based upon Stock Market Indicators which just don't work as well (or at all) in a bi-direction market such as FX.

Quoting braintheboss
... I think don't use SL is not responsible to kill accounts and you can think I'm wrong. But i can demonstrate it....
I understand how difficult it is to write in a 2nd language, however there are so many negatives in that statement that I can't work out what you mean.
If you mean " Not using a Stop Loss is responsible for the total loss of 'many' or of 'most' or even 'almost all' retail trading accounts. " Then of course we agree!
If you mean that "Using a Stop Loss causes the total loss of most retail trading accounts." Then I disagree, but it is something that is very hard to prove objectively rather than logically.

Quoting braintheboss
....Can you demonstrate objectively all your conclusions here? .....
Yes, I think that I can do that for at least most of them and have done so in my other thread. But some rely on a proof using logic which is something that I understand but the average FF member may not have been trained in. My training was as a mathematician and Computer Scientist before I retired.

P.S. I have to go now since I have other commitments - so please don't think that I am ignoring any replies !
  • #25
  • Mar 16, 2019 2:56pm Mar 16, 2019 2:56pm
Quoting ianf0ster
{quote} I think we agree there ! In short much 'retail trader education' is based upon Stock Market Indicators which just don't work as well (or at all) in a bi-direction market such as FX. {quote} I understand how difficult it is to write in a 2nd language, however there are so many negatives in that statement that I can't work out what you mean. If you mean " Not using a Stop Loss is responsible for the total loss of 'many' or of 'most' or even 'almost all' retail trading accounts. " Then of course we agree! If you mean that "Using a Stop Loss...
About SL i wanted told many people says if you don't use SL then you will lost account. But that people lost account due to other reasons. Even using SL they will lost it. Maybe if they don't use SL accelerate the process, but is not main reason. Even is not very relevant in that process.

No problem about answer all. Everybody have a life outside this forum. Regards and I hope you have nice week
Try don't lose pants never...
  • #26
  • Mar 16, 2019 6:28pm Mar 16, 2019 6:28pm
Quoting braintheboss
{quote} About SL i wanted told many people says if you don't use SL then you will lost account. But that people lost account due to other reasons. Even using SL they will lost it. Maybe if they don't use SL accelerate the process, but is not main reason. Even is not very relevant in that process. ...
Hi Braintheboss,
I firmly believe that every trade (by a retail trader) must for safety of the account, be placed with a StopLoss. But even that won't always protect your account. I don't know if you were trading during any of the 'Flash Crashes' or when the Swiss National Bank caved in on the Euro exchange rate, or during 9/11 or the London terrorist attacks in 2005 I think.

I was trading during those times and so I know that in serious market mayhem a Stop Loss (even a so-called guaranteed Stop Loss) may not save your account! - Why? because with an ordinary stop Loss, the Market Maker just remove all their liquidity in the direction of the spike for hundreds of pips/ticks - so there are no quotes for your Broker to offer you. In the case of a 'guaranteed Stop Loss' you may be lucky, but if you aren't then your Broker will go bankrupt in just a few minutes! This is what happened to many Brokers on the Swiss National Bank capitulation. OK, some of those who went Bankrupt did so not because of offering guaranteed Stop Losses, but because they were acting as a Market Maker in taking the other side of their customers' trades.

The educators on both of the 2 courses that I admire both say that A). You should always have a Stop Loss placed with your Broker! B). That it should be very rare indeed for your Stop Loss to be hit! - Why is that ? It is because that Stop loss should be an 'Emergency Stop Loss' and during normal market action you should detect dangerous Price Action (etc,) and manually close your trade for a much smaller loss rather than just hope it will turn around for you.

I am told that the big institutions do not use a Stop Loss at all. Most of their trades are hedged from inception, and with the ones which are not hedged when the Risk Manager tells the trader to reduce their exposure then the trader has to either find a good hedge or start cutting the position.

Institutional traders have been instantly fired for leaving a winning trade on, un-managed overnight. My mentor Ray de Medici says he remembers that a colleague once made that mistake: the guy left a moderate sized institutional position open overnight. He came in to work and found it was in profit by a little over 2 million Dollars, but that he was sacked! Doing that in the Institutional space is a 'no second chances offense'!
  • #27
  • Mar 17, 2019 3:20am Mar 17, 2019 3:20am
Quoting ianf0ster
{quote} Hi Braintheboss, I firmly believe that every trade (by a retail trader) must for safety of the account, be placed with a StopLoss. But even that won't always protect your account. I don't know if you were trading during any of the 'Flash Crashes' or when the Swiss National Bank caved in on the Euro exchange rate, or during 9/11 or the London terrorist attacks in 2005 I think. I was trading during those times and so I know that in serious market mayhem a Stop Loss (even a so-called guaranteed Stop Loss) may not save your account! - Why? because...
I was at Swiss crash ( Alpari UK ). Fortunately i didnt trade CHF at that time ( I started trading at 2012 ). As retail trader I dont know how works sharks and its good your comment about them. Anyway sharks let their trading to software most of time then every time is less important their human decisions.

About SL, as im showing in one thread with a practical example, the main factor for keep safe your account is lot size and "hedge" ( just don't open same pair trade for cover a current loss ). I always do my research by comparison and SL have a negative effect in profits and really don't improve your DD. Its a placebo effect. The best SL is place the right trade at right moment ( i know, is not easy )
Try don't lose pants never...
  • #28
  • Mar 17, 2019 6:02am Mar 17, 2019 6:02am
Quoting braintheboss
{quote}.... About SL, as im showing in one thread with a practical example, the main factor for keep safe your account is lot size and "hedge" ( just don't open same pair trade for cover a current loss ). I always do my research by comparison and SL have a negative effect in profits and really don't improve your DD. Its a placebo effect. The best SL is place the right trade at right moment ( i know, is not easy )
Hi Braintheboss,
I see that you are trying to trade in a type of Quant style with very many, very small trades open at once. You seem to be currently breaking your rule about only 1 open trade per pair and you have only been testing this approach for a relatively short time i.e you started sometime this year.

Attached Image (click to enlarge)
Click to Enlarge Name: brain.png Size: 106 KB


Unfortunately, even if you were sticking to your rules, your method would see your account wiped out by a big trend which happens more often than you may think.

When I started FX trading I was intrigued by a guy who said that his MT4 EA had not had a losing trade for many years. That was almost true (MT4 had not been available at his supposed start date). But all it did was to ramdomly go long or short the Euro/Usd (only 1 open trade at a time) with a 10 pip TP and a 1,000 pip SL. Naturally the timing was perfect, he was selling it just before the Euro-zone crisis and it promptly wiped out the accounts of many unfortunate customers (not me in this case).
  • #29
  • Edited 6:26am Mar 17, 2019 6:15am | Edited 6:26am
Quoting Husky77
{quote} ...... In the end what i dont get it is the real purpose of this thread, but i think we will know it soon. as just simple information to help newbies to STOP dreaming green horses on the walls yes then i agree. but you as me and many others you know already this will not help. is like when you tell to one casino player ''dont go there cos you lose'' , he knows that already and thats not enough to keep him out ,he is going there just because there is a skinny possibility to win thats the only reason and this create a behaviour in his...
Hi Husky,
In general I agree with you. Where I disagree is that there is no point in trying "to help newbies to stop dreaming green horses on the walls". I think that traders who have gone through all that should help them - although I am unable to reach many newbies because of being classified as a 'commercial' because of me trying to help the newbies.
But you are right that many/most are addicted to gambling and will continue to ignore advice that they know is good advice.

But there are others (like I was) who just need a little help in order to be able to discriminate between good advice and the total cr4p that they are swamped with!
I also feel that it is almost impossible to learn how to trade without spending some money on education. Even the sh1t courses I paid for as a newbie actually taught me something - if only that that approach didn't work, or didn't work for me!.
  • #30
  • Mar 17, 2019 6:28am Mar 17, 2019 6:28am
Quoting ianf0ster
{quote} Hi Braintheboss, I see that you are trying to trade in a type of Quant style with very many, very small trades open at once. You seem to be currently breaking your rule about only 1 open trade per pair and you have only been testing this approach for a relatively short time i.e you started sometime this year. {image} Unfortunately, even if you were sticking to your rules, your method would see your account wiped out by a big trend which happens more often than you may think. When I started FX trading I was intrigued by a guy who said that...
Its 4th month. I had change broker because tickmill demo servers have many disconnections. Anyway I'm using this since 4 years in manual then its a proved MM. Now I'm testing it with auto system.

Anyway I'm not breaking that rule. As i explained in some post I use 2 setups per test. Every setup is a full system with small differences. Then its normal have duplicate trades but individual setups only opens one trade per pair. I only break 2 rules because i want know the limits.

1) I use lower lot per trade. This is more for don't pollute TE with big values. I want people check the important areas...
2) I don't close any bad trade. Really both GBP trades will be closed in normal conditions. But this help to see how good is stack cleaning

About your prediction about will wipe account we will see. If I do something different to others is show my tests without hide anything. In a few months it will be clear if my MM works well with auto systems. But maybe you will get a surprise.

If works and account will not blow is basically because system have a balance between trade quality and constant in/out cycle. Exit rules only secure this balance. Anyway time will say. Its only fact in this story
Try don't lose pants never...
  • #31
  • Mar 17, 2019 6:43am Mar 17, 2019 6:43am
I would like say something more. You told me you was math/computer scientist. I have lack of math ( for be a coder ) but I still have enough vision for use simple math in a more complex way.

Precisely i use a kind of weighted rules for distribute tools signals in a "random" way. I explained this long time ago in my tools thread. Its simple maths but affects heavily how tools mix is made without have change any code line in tools. It give me control about how i want every tool signal affects other too. Sometimes simple ideas works better than complex.

Really i see auto systems as a set of puzzles pieces...
Try don't lose pants never...
  • #32
  • Mar 17, 2019 6:50am Mar 17, 2019 6:50am
Some people may wonder if I really do run a free Self Help Group (for Sharp Edge students only) with approx 380 members.

Perhaps these will help to convince: any doubters:
Selected pages from members list (identities protected):
Attached Image (click to enlarge)
Click to Enlarge Name: Self-Help-Group-1.png Size: 73 KB

Attached Image (click to enlarge)
Click to Enlarge Name: Self-Help-Group-2.png Size: 69 KB

Attached Image (click to enlarge)
Click to Enlarge Name: Self-Help-Group-3.png Size: 65 KB

Attached Image (click to enlarge)
Click to Enlarge Name: Self-Help-Group-last.png Size: 58 KB


Subjects in our group's knowledgebase:
Attached Image

Attached Image
  • #33
  • Mar 17, 2019 6:53am Mar 17, 2019 6:53am
Quoting ianf0ster
Some people may wonder if I really do run a free Self Help Group (for Sharp Edge students only) with approx 380 members. Perhaps these will help to convince: any doubters: Selected pages from members list (identities protected): {image} {image} {image} {image} Subjects in our group's knowledgebase: {image} {image}
Look good. Maybe their question is why are you commercial if is free...
Try don't lose pants never...
  • #34
  • Mar 17, 2019 7:02am Mar 17, 2019 7:02am
Quoting braintheboss
{quote} Look good. Maybe their question is why are you commercial if is free...
Hi Braintheboss,
The FF policy about 'Commercial Content' is that any thread about a commercially available product/service is commercial.
And anybody who starts such a thread is also considered to be commercial - it doesn't matter whether the thread is actually ripping off a commercial system (such as the many BTMM or M and W threads are), or whether they just contain information already made freely available by the owners of such commercial systems (such as my other thread).

So far as FF is concerned, I started a thread about 2 commercial products, therefore I am a commercial even if I don't rip anybody off, don't get paid for my opinions on commercial systems and don't charge for the service I provide!

It came as a surprise to me that they take this view, otherwise I might have not started my first thread on a commercial trading education.
  • #35
  • Mar 17, 2019 7:28am Mar 17, 2019 7:28am
Quoting ianf0ster
{quote} Hi Braintheboss, The FF policy about 'Commercial Content' is that any thread about a commercially available product/service is commercial. And anybody who starts such a thread is also considered to be commercial - it doesn't matter whether the thread is actually ripping off a commercial system (such as the many BTMM or M and W threads are), or whether they just contain information already made freely available by the owners of such commercial systems (such as my other thread). So far as FF is concerned, I started a thread about 2 commercial...
I agree FF rules are weird. Anyway maybe you can ask Twee if he can change your status. You are senior member and I think you are enough time here for they know if your commercial label was wrong. Regards...

PD: I like your conversation way. I'm sorry for caps comment. If you want use it any problem by my side. I understand the issue
Try don't lose pants never...
  • #36
  • Mar 17, 2019 8:28am Mar 17, 2019 8:28am
Quoting ianf0ster
{quote} Hi Braintheboss, The FF policy about 'Commercial Content' is that any thread about a commercially available product/service is commercial. And anybody who starts such a thread is also considered to be commercial - it doesn't matter whether the thread is actually ripping off a commercial system (such as the many BTMM or M and W threads are), or whether they just contain information already made freely available by the owners of such commercial systems (such as my other thread). So far as FF is concerned, I started a thread about 2 commercial...
really weird rules as you may see the ones who we really spot them as they make tricks around and try to attract newbies out of this place for any kind of commercial things they make them commercial after long way of work. but those who really are honest people and just try to help community in a very simple way boom in no time they get commercial.
maybe the time will come when all this commercial section will be removed cos even if FF say they dont make any money from this is a plague as many too many scammers attract newbies in all kind of tricks ,and this is first thing one new guy really dont need in his first steps in forex world, an idiot who want to scam him.
regards
Take what you can, give nothing back
  • #37
  • Mar 18, 2019 8:08am Mar 18, 2019 8:08am
Quoting ianf0ster
Why do the vast majority of Retail Traders either make a loss, or not as much profit as they should make? ............................. 1. Lack of, or poor Money Management aka Trade Management. At its simplest this can be just lack of sufficient capital. However it is many times easier and much more profitable to trade multiple units of smaller size................


In my examples I am being more than fair to All-In All-out, because I don't want anybody saying that they are 'Cherry-picked'

I could have picked a ranging market where the All-In, All-Out failed every time. Instead I have picked a trend which may or may not be exhausting.
Attached Image (click to enlarge)
Click to Enlarge Name: Example-All-In.png Size: 59 KB


To continue my argument: There is no real (mathematical or statistical) advantage in using a 2:1 Reward: Risk ratio rather than 1:1 or even 1:2. With a 2:1, you should be expecting the trade lose approximately 66% of the time. To that percentage you need to adjust it higher because of the Spread and/or commission, then subtract an adjustment for your 'edge'.

If I assume that your edge is small, which is true for the vast majority of retail traders, then out of 10 trades you are likely to lose 6.
How do/would you feel after 5 or 6 consecutive losing trades? Would that break your discipline and make you snatch at small profits?
5 or 6 consecutive losses out of 10 is very frequent if you are using 2:1 . There is a 1 in 10 chance that you will have 6 consecutive losses. Heck it is even quite frequent even if you have a 50% chance i.e using 1:1 !
How may trades will you do in your lifetime?

The problem is that once you break your discipline you are stuffed, you will keep swinging between 'snatching profits and missing big winners' and taking losses after the trade was well in profit.

This is why, once you know how to trade, trading becomes something like 90% Psychology.

Using Multi-units protects you from yourself. Thus it makes trading easier and ultimately more profitable.
But how many traders are taught to use it?
Well it just so happens that both the 'Indicator based' and the 'Institutional style' courses that I like (they are from different sources) teach Multi-unit and Multi-exit and even Multi-Entry techniques!
  • #38
  • Edited 11:44am Mar 18, 2019 11:32am | Edited 11:44am
Better to trade several smaller sized units than one big unit continued.

Here is a comparison of a micro-lot account with a mini-lot account. Same difference between mini and standard sized!

Attached Image (click to enlarge)
Click to Enlarge Name: Compounding.png Size: 82 KB


This is from an 'Ask his Students' webinar presentation I gave in August 2018

The advantage of the multi-entry level strategy such as entering 3 units, then 6, then 12 is that your break-even gets progressively closer. And you still have at least 3 Take Profit levels available to you even get the entry price right and only get the 1st level of units on the trade.
  • #39
  • Mar 18, 2019 11:50am Mar 18, 2019 11:50am
Retail Trader Ignorance:
Here is a wonderful and accurate schematic created by the well known FF member called 'Hanover' (or David as I call him).

Attached Image (click to enlarge)
Click to Enlarge Name: Hanovers-The-Market-Iceberg.png Size: 259 KB
  • #40
  • Mar 18, 2019 12:02pm Mar 18, 2019 12:02pm
Quoting ianf0ster
Retail Trader Ignorance: Here is a wonderful and accurate schematic created by the well known FF member called 'Hanover' (or David as I call him). {image}
I love this pic
0 traders viewing now