Why Traders fail despite of good system available here in Forum??

Dear All,

As you may have notice there are so many stories whether people lost all there earning OR forex is not making them any money OR they are not just successful in forex.

I dont understand what is the reason as they are so Many system which any one could pick and trade of them like SIDUS, BAGOVINO OR SRDC E.T.C. E.T.C.

If these system are good then why still there are so many loser stories in this forum.

Are they not following the system or they are out of luck or why??/

I don't use any of the systems mentioned for say;

1) I don't think most stick w/ the system long enough to work

2) They aren't using proper MM trying to get rich quick


turbo

Psychology. That is the only concrete answer to your questions. From this one word, several tangents come off. Some of them are:

- unreal expectations of returns
- not enough critical mass, ie enough capital to actually make the returns they want to
- jumping in headfirst rather than spending the time learning
- excessive use of leverage
- non-preparedness to deal with a loss
- no plan
- not enough time spent developing discipline. It is easy to say to trade with discipline, but it takes time to develop that
- Not understanding money management

I am sure the list is a lot longer, but these were the first things that came to mind. I am sure Fiji can expand on this till the cows come home, but you get the idea...

It all starts between the ears, and it also finishes there.

One of my favourite statistic disection is the win rate. eg. if we read a new system, and the author says he has a win rate of 80%, a newbie will say, fantatic. I am going to win 80 out of 100 trades. However, guarenteed he will lose faith in the system if his first 20 trades are losers. Lack of understanding what the system actually does, lack of reading and understanding what he is doing and why he is doing it will make him quit. And onto the next system. The only system that is going to wrk for a trader is one that he has developed (albeit it a modification/adaptation) of other systems. But if he understands it in his mind, and believes in it (which will come from back testing and forward testing), then he will succeed.

Cheers,
K

much better said

The problem with using a system that someone else created is one is left with a distinct lack of ownership. This leads to a lack of confidence in the system which is absolutely essential in order to trade through the drawdowns.

It is in our nature to want to tinker with things. This is extremely true with trading systems. If you don't think so, go to any trading forum, find a thread in which a system has been revealed and then watch how the others start changing it. I've seen a system get changed so much in such a short time, that it becomes unrecognizable from the original.

The things the poster above mentioned are valid, but before any of those can be addressed, one needs their own system. Van Tharp teamed up with a very successful trader, Tom Baldwin, I believe, and tracked the participants of his seminars in which he revealed his exact trading methodology. Over a period of a few years, only 1% of them were successful. Guess how many were trading Tom's system exactly has he had created it? Yep, 1%. The other 99% just kept messing with it.

So, what's the answer? Well, there's no need to create new indicators, find new patterns, discover hidden meaning in a bowl of rice or anything like that. But one needs to take what is out there and put it together in their own way, using their own ideas, own terms, own parameters, own everything. One needs to backtest it and then forward test it. One needs to make it their system by imprinting it with their thoughts and work. Only then will you derive a sense of ownership of the system. Once you have that, you'll understand the parameters of the inevitable drawdowns, plus every other parameter you need to know. Then, and only then, will you have a shot at being successful.

Btw, I live in Al Ain.

Nat

Many good reasons just posted,all of them valid. I'd like to expand on one--
Money management. In Forex we have this wonderful thing called leverage. After a few months of trading I had one week where I tripled my account(real money) in 3 trading days. My system--here it is for those that need to know-- was simply a complete lack of MM and blind luck. Indefensible overtrading. It's the worst thing that can happen to a new trader. I blew account after account (real money again) trying to duplicate those results.
Then I learned more about Forex and how to trade. But it was a long time before I could put the idea of tripling my account to rest.
After learning proper MM and the difference between broker leverage and true leverage and how much is proper I decided to trade microlots. It was humbling at first, but unless you have a huge account it is the way to go.
Many advantages and no disadvantages that I can see. Now I look at it as a sign of being better educated.
If any one is going to succed in Forex they MUST follow the MM sticky at the beginning of this forum or at least something very close.
You can save a lot of time and money and stress by surrendering to good MM early on. The sooner you do, the more likely you are to succeed.

yes thats the one...many expect to trurn $100 to 1 million in the blink of an eye....

You said "despite of good system..."
Well, they might look good but not good enough for such an unpredictable, constantly changing market. Creating, developing system, or developing discrecionary skills in Forex is very, very difficult task. Achivable but very difficult. And also most people does not posses a talent to be a succsesful in Forex, in the first place. For those people need years of searching and practice, to see any succses in the long term bases.

I thought I would put in my 2 cents worth based on my own experience.

Although there may be many systems that may be profitable, one of the points I have to mention is that everybody's psychology is different. Some people find it easier to scalp, some day trade, some position trade, some swing trade...

Take this example: in my country (Australia) people working in a trade can earn a lot of money, so why dont more people do a trade? Because (for one reason) many aren't psychologically suited to this type of job.

Trying to use a system that doesn't suit your psychology will frustrate you, simply because it doesn't suit you!

We are all different and need to develop our own (or alter other strategies) so they suit our psychological profile.

Just my 2 cents worth.