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Now I know why 95% of traders are on losing side

  • #141
  • Oct 22, 2007 7:34am Oct 22, 2007 7:34am
Quoting WTB
I think he was probably talking about a perfect hedge (swap free second account) trading approach.

Must be... cause if you have two accounts that means one account gets hammered while the other account grows. Why else would you have 2 accounts?

I have thought about this the whole morning and still dont see the sense in having two accounts only to show profit in the one while the other account shows a loss. If this is not the case then why have 2 accounts? I am sure you can do whatever you wanna do with only 1 account? Or am i very ignorant here?
  • #142
  • Oct 22, 2007 8:36am Oct 22, 2007 8:36am
i'm sorry but i think thats as much as i could tell...you'll have to figure the rest out. Trading involves short term, mid term and long term methods....there are many ways to exploit price trends. if you only trade a single term trend, then likely you're missing out on a lot of small swings where you could take high probability trades...and i believe Jacko has said something similar in his thread as well about long term, intermediete and short term trading.

words from an experienced trader i got to know,
If you believe that the 2% rule will continue saving you, it will....but all you'll just be is another mere trader, capital protection is important, rapid exponential growth is just as important.

kind regards
jest
  • #143
  • Oct 22, 2007 9:34am Oct 22, 2007 9:34am
Quoting The Jedi
Don't tell me you're "half muslim"? I think if anyone figures out what I mean, they deserve to know.
Swap rates, interest free / swap free accounts for people with belief they mustn't make money off of money..
Trust price. Know yourself.
  • #144
  • Oct 22, 2007 10:43am Oct 22, 2007 10:43am
Quoting jest1081
i'm sorry but i think thats as much as i could tell...you'll have to figure the rest out. Trading involves short term, mid term and long term methods....there are many ways to exploit price trends. if you only trade a single term trend, then likely you're missing out on a lot of small swings where you could take high probability trades...and i believe Jacko has said something similar in his thread as well about long term, intermediete and short term trading.

words from an experienced trader i got to know,
If you believe that the 2% rule will continue saving you, it will....but all you'll just be is another mere trader, capital protection is important, rapid exponential growth is just as important.

kind regards
jest
well i must be honest and say that i am not convinced by exploiting short term, mid term, and long term trends at the same time. In my opinion it's the perfect way to put yourself in checkmate.

But each to his own. As long as your making money. That's all that matters.

ps....but one thing i have realized is if someone is all secretive about his methods then it is just that...an enigma...cause i logg into FX street daily to attend their webinars and i get to learn from pros like Ed Ponsi, Matt Kirk, Rob Booker, Ian Copsey, Tony Juste, Raghee Horner, Derek Frey, Boris Schlossberg, Kathy Lien, Jerry Furst all renowned traders that i respect and who's books i have read. And none of them follow this approach
  • #145
  • Oct 22, 2007 10:54am Oct 22, 2007 10:54am
...i believe daytrading is the best and most profitable it works magic for me, been in this game and trading only daily charts very succesfully,may be one day i'll post my trades & system..just to make you believe & profitable!
  • #146
  • Oct 22, 2007 11:15am Oct 22, 2007 11:15am
Quoting 30pips
...i believe daytrading is the best and most profitable it works magic for me, been in this game and trading only daily charts very succesfully,may be one day i'll post my trades & system..just to make you believe & profitable!

Yes i agree. Trading the daily charts are awesome and very profitable. I think it's the safest way to trade.
  • #147
  • Edited 12:09pm Oct 22, 2007 11:20am | Edited 12:09pm
Quoting iandekoker
well i must be honest and say that i am not convinced by exploiting short term, mid term, and long term trends at the same time. In my opinion it's the perfect way to put yourself in checkmate.

But each to his own. As long as your making money. That's all that matters.

ps....but one thing i have realized is if someone is all secretive about his methods then it is just that...an enigma...cause i logg into FX street daily to attend their webinars and i get to learn from pros like Ed Ponsi, Matt Kirk, Rob Booker, Ian Copsey, Tony Juste, Raghee Horner, Derek Frey, Boris Schlossberg, Kathy Lien*, Jerry Furst all renowned traders that i respect and who's books i have read. And none of them follow this approach
*Someone told me abt a seminar Kathy held in KL? She did a live news trade, confidently said price will move down once the news was made but it moved the opposite direction? Not sure abt its truth but that was really funny.

well u've said it, to each his own...price is price, as long as we know when and how to exploit 'em why should one complain? and anyway it doesnt really matter if one is convinced or not. There are plenty of setups to take from daily may it be on the short term or the long term....one factor a trader needs to know is...what is the setup, its expectancy and when to declare you're wrong abt the setup and its probability. Thats all to it...

To be caught in a checkmate when looking at trend terms? Looks like we'll have to re-read the dow theory all over again to get a better understanding of price trends then.

Anyway, there are many unreknowned traders who keep their books tight too...maybe what we have really seen in the markets and the truth abt it are just really the tip off the iceberg...I'll end our discussion here. Thanks.
  • #148
  • Oct 22, 2007 1:50pm Oct 22, 2007 1:50pm
Quoting hanover
In one of Metaquotes' EA trading competitions, there was an EA (from memory it was called something like 'Robin Hood') that operated with a 6 pip target and a 140 pip stoploss. It finished in the top 10 with a 100% win rate over something like 26 trades. Its inventor was selling the EA on his website.

Would have only taken one loser to wipe out all of the winnings though. Sounds a bit like playing Russian roulette!

David

This really doesnt seem that hard to understand to me. Now, I'm not saying that it fits my style, but I see the logic.

A market will move 6 pips over a given period of time. Lets say (pulling numbers out of a hat) that it moves 6 pips, up OR down, 100% of the time in a 1 hour window. This isn't hard to see happening.

Now, there is also a given ratio that the same market will move 140 pips ( the stoploss above) in the SAME 1 hour period. But the percentage is very low, say %1 of the time. This means that we would win 99/100 trades without hitting the SL. 6 pips X 99 trades = 594 pips total, with 1 140 pip loss. This represents a RR of roughly 7/30, not too bad.

Now, if you lessen the timeframe to capture those 6 pips on each trade, you might lessen the 100% chance down to, say 95%, but you should also lessen the probability of the 140 pip loss, since you have less time for it to happen.

These are just general musings, but certainly you could see how the original poster is doing this with a 5 pip target and a 20 pip SL. It could even be argued that he would do BETTER with a larger SL, since the odds of him hitting it should go down.

Am I making any sense?? Even i'm not sure.

EDIT - I've just realized a huge flaw in my logic here, since if it moves the wrong way AT ALL, you still lose, until such time that the market retraces itself and hits your TP. So, it still is a requirement that you hit the trend in the right direction for this to work, or use a longer timeframe. bleh.
Disregard all prognostications.
  • #149
  • Oct 22, 2007 6:34pm Oct 22, 2007 6:34pm
Quoting WTB
I think he was probably talking about a perfect hedge (swap free second account) trading approach.
That would be what I meant, yes. Isn't it funny how you answer someone's cryptic message with another one and they get all warm and fuzzy over it? To those that were able to answer for me while I was at work, thank you.

As for having two accounts, there are a few possibilities. One is just divesting your funds for less of a shock should something happen like a Refco bomb, not putting all your eggs in one basket. Two is taking advantage of trading options in one account and then hedging with a spot trade in the second account. Third is the interest bearing and non-interest bearing account like I was alluding to earlier. Four would be day-trading one account for income purposes or the like and then swing/position trading in the second account for more control over your funds. There's plenty more ideas than that. My personal choice would be an options/futures account and a non-interest bearing spot account for a versatile mix considering how I trade. Of course, whoever said you had to just have two accounts?
Never underestimate the powers of the Force.
  • #150
  • Oct 22, 2007 10:02pm Oct 22, 2007 10:02pm
Quoting The Jedi
That would be what I meant, yes. Isn't it funny how you answer someone's cryptic message with another one and they get all warm and fuzzy over it? To those that were able to answer for me while I was at work, thank you.

As for having two accounts, there are a few possibilities. One is just divesting your funds for less of a shock should something happen like a Refco bomb, not putting all your eggs in one basket. Two is taking advantage of trading options in one account and then hedging with a spot trade in the second account. Third is the interest bearing and non-interest bearing account like I was alluding to earlier. Four would be day-trading one account for income purposes or the like and then swing/position trading in the second account for more control over your funds. There's plenty more ideas than that. My personal choice would be an options/futures account and a non-interest bearing spot account for a versatile mix considering how I trade. Of course, whoever said you had to just have two accounts?
Personally I have always managed more than one account in Forex. Currently I have four seperate accounts. I like having a number of different accounts not only because of some of the reasons mentioned above but also simply for reasons of organization and efficiency of business.

I use one account for positions on Carry Trades, another for non Carry Trade positions, the third for swing trading my favourate pairs and the fourth, purely for daytrading. Rather than placing numerous trades on numerous currency pairs I prefer to take larger positions on fewer pairs. I therefore, only trade a very limited number of currency pairs in each account, that makes looking for trade setups a minimally time consuming excercise.

I also maintain two non Forex accounts, an options/futures account and a stock market account. Again, in keeping with good and efficient business practices, similar to those employed in Forex, these accounts are used to trade only a very few specific instruments and only with a very specific methodology for each.

To me trading is not a do all and end all unto itself. I do not rely on trading as a sole source of income and would never want to strive to do so. Trading is just one area of the overall business of wealth creation. As such I always attempt to conducted it in the most business like and efficient manner as is possible with of course, the intention of making a profit. I am then free to to persue other venues of wealth building as well as taking time to enjoy the fruits of my entrepreneurship.
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #151
  • Oct 22, 2007 10:25pm Oct 22, 2007 10:25pm
Quoting iandekoker
After reading numerous of these threads I realize why most traders DO NOT make money in forex. It's because of the following reasons:
Does this mean that you are profitable? Or is this another post by an amatuer to other amatuers?

Quoting iandekoker
1. Traders open a mini/micro account with $500 and then play volatile currencies with $1 lots. Now this is a sure way to blow account after account. Besides you will NOT make money trading a mini/micro account. The odds are against you. That is the reason why brokers allow you to open a mini/micro account. They know sooner or later you will get your leverage and/or stop losses wrong.
Money management is one of the most commonly stressed things by the more experienced traders, nothing new there. Brokers are there to take your spreads, so being profitable is good for them.

Quoting iandekoker
2. Most traders DO NOT know when to take profits.
You can't prove anything with examples and there are so many systems out there that it having a blanket rule on when to take profit seems unreasonable to me.

Quoting iandekoker
3. New traders all look for a "trading system" comprised of Indicators. Indicators are lagging and will NOT make you money in a ranging market which happens to be 70% of the time. So many systems are based on the 4hr chart. Do you know how many pips the market can move in 4 hours? By the time you get into a trade the big dogs are ready to take profit. That only leaves you with a small gain and sometimes even a loss.
You know these "big dogs" personally? The most successful trader that I know personally trades on multiple time frames from daily to 5 minute charts. He typically makes around two thirds on the five minute charts but they also require a lot of time in front of the screen. He recommends finding the time frame that suites your life style.

Quoting iandekoker
4. Most traders don't know what is the driving force behind a currency.
One of my favourate Darkstar quotes goes something like "fundamentals don't mean anything" and indeed my modestly successful (I'm no where near going professional myself) strategy only takes a passing interest in reports.

Quoting iandekoker
5. But the biggest mistake any trader can make it to take advice from an amateur trader. Amateur traders teach amateur traders to trade like amateur traders.
True but at the same time you can learn from others mistakes. If I watch someone jump of a wall and break a leg then I'll know not to do that.
I know nothing about elliot waves or fib's and have only a passing knowledge of stochastics which many people use. However I still read posts by these people because I find wisdom in other peoples learning processes.
What is a MacD if its not a burger?
  • #152
  • Oct 22, 2007 10:30pm Oct 22, 2007 10:30pm
There ARE certain non-lagging indicators which you can write on your own, like i write mine which are able to look into the future and forecast the next move.

I have ttried them on almost all pairs including the most volative GJ with 98% success rate.

How ?

Make an excel sheet with the daily data and observe very very carefully how a pair reacts based on previous day's close value.

If it trades above the previous day close then how much, if it trades below then how much.

It will give you the jackpot, find out why on your own.


Locate the pattern, that pattern is your jackpot
  • #153
  • Oct 22, 2007 11:15pm Oct 22, 2007 11:15pm
Quoting Marrethiel
What is a MacD if its not a burger?
MacD is a famous hamburger at McDonald's, also known as Big Mac ... it's pretty good, you should try one sometime ...
  • #154
  • Oct 23, 2007 12:15am Oct 23, 2007 12:15am
Quoting fxhermit
Personally I have always managed more than one account in Forex. Currently I have four seperate accounts. I like having a number of different accounts not only because of some of the reasons mentioned above but also simply for reasons of organization and efficiency of business.

I use one account for positions on Carry Trades, another for non Carry Trade positions, the third for swing trading my favourate pairs and the fourth, purely for daytrading. Rather than placing numerous trades on numerous currency pairs I prefer to take larger positions on fewer pairs. I therefore, only trade a very limited number of currency pairs in each account, that makes looking for trade setups a minimally time consuming excercise.

I also maintain two non Forex accounts, an options/futures account and a stock market account. Again, in keeping with good and efficient business practices, similar to those employed in Forex, these accounts are used to trade only a very few specific instruments and only with a very specific methodology for each.

To me trading is not a do all and end all unto itself. I do not rely on trading as a sole source of income and would never want to strive to do so. Trading is just one area of the overall business of wealth creation. As such I always attempt to conducted it in the most business like and efficient manner as is possible with of course, the intention of making a profit. I am then free to to persue other venues of wealth building as well as taking time to enjoy the fruits of my entrepreneurship.
Extremely well said. Thanks for posting that as it definitely answers a lot of the unanswered questions about the possibilities with multiple accounts, especially my own. I imagine you would have end products that you invest your trading revenue into like VUL's and IRA's?

I forgot about adding to the account mix with an equities account (day trading, all the kids are doing it these days...like me). Do you also have a regular commodities account? I realise that currencies are considered commodities in the trading world, but they definitely seem to take on a commercial life of their own compared to the rest of the commodities.

As an aside to the commodities point, anyone else interested to see how the currency futures are going to do on ICE? They start trading November 9th.
Never underestimate the powers of the Force.
  • #155
  • Oct 23, 2007 12:15am Oct 23, 2007 12:15am
Quoting fxhermit
Personally I have always managed more than one account in Forex. Currently I have four seperate accounts. I like having a number of different accounts not only because of some of the reasons mentioned above but also simply for reasons of organization and efficiency of business.

I use one account for positions on Carry Trades, another for non Carry Trade positions, the third for swing trading my favourate pairs and the fourth, purely for daytrading. Rather than placing numerous trades on numerous currency pairs I prefer to take larger positions on fewer pairs. I therefore, only trade a very limited number of currency pairs in each account, that makes looking for trade setups a minimally time consuming excercise.

I also maintain two non Forex accounts, an options/futures account and a stock market account. Again, in keeping with good and efficient business practices, similar to those employed in Forex, these accounts are used to trade only a very few specific instruments and only with a very specific methodology for each.

To me trading is not a do all and end all unto itself. I do not rely on trading as a sole source of income and would never want to strive to do so. Trading is just one area of the overall business of wealth creation. As such I always attempt to conducted it in the most business like and efficient manner as is possible with of course, the intention of making a profit. I am then free to to persue other venues of wealth building as well as taking time to enjoy the fruits of my entrepreneurship.
Seems like there are a few people trading more than one account. Wow and i thought i was making it difficult for myself trading more than 1 currency pair....lol
  • #156
  • Oct 23, 2007 12:27am Oct 23, 2007 12:27am
Quoting Marrethiel
Does this mean that you are profitable? Or is this another post by an amatuer to other amatuers?

Let's put it this way. I make more in a month with forex than you would in a year. So i guess you can call me an amateur


Money management is one of the most commonly stressed things by the more experienced traders, nothing new there. Brokers are there to take your spreads, so being profitable is good for them.

And brokers just hate you loosing .....why?


You can't prove anything with examples and there are so many systems out there that it having a blanket rule on when to take profit seems unreasonable to me.

Exactly why 95% of all traders are not profitable

You know these "big dogs" personally? The most successful trader that I know personally trades on multiple time frames from daily to 5 minute charts. He typically makes around two thirds on the five minute charts but they also require a lot of time in front of the screen. He recommends finding the time frame that suites your life style.

Yes i know Lassie and Boomer and Fido personally. Great dogs they are...lol


One of my favourate Darkstar quotes goes something like "fundamentals don't mean anything" and indeed my modestly successful (I'm no where near going professional myself) strategy only takes a passing interest in reports.

Wow okay some traders really like trading blindfolded. Hopefully your not trading Jpy or longing the USD.


True but at the same time you can learn from others mistakes. If I watch someone jump of a wall and break a leg then I'll know not to do that.
I know nothing about elliot waves or fib's and have only a passing knowledge of stochastics which many people use. However I still read posts by these people because I find wisdom in other peoples learning processes.
What is a MacD if its not a burger?
HHHmmmmm ok
  • #157
  • Oct 23, 2007 12:34am Oct 23, 2007 12:34am
Quoting forexlion
There ARE certain non-lagging indicators which you can write on your own, like i write mine which are able to look into the future and forecast the next move.

I have ttried them on almost all pairs including the most volative GJ with 98% success rate.

How ?

Make an excel sheet with the daily data and observe very very carefully how a pair reacts based on previous day's close value.

If it trades above the previous day close then how much, if it trades below then how much.

It will give you the jackpot, find out why on your own.


Locate the pattern, that pattern is your jackpot
You are contradiction yourself. You say there are some indicators that doesn't lagg and you use one that looks into the future based on an excell sheet with daily data which is LAGGING since you can only use yesterday's data on the excell spreadsheet since today's data is not completely unfolded
  • #158
  • Oct 23, 2007 2:07am Oct 23, 2007 2:07am
Quoting Marrethiel
One of my favourate Darkstar quotes goes something like "fundamentals don't mean anything" and indeed my modestly successful (I'm no where near going professional myself) strategy only takes a passing interest in reports.
OMG! I don't know why you would say this Marrethiel?!? Fundamentals are the driving forces behind currencies.
  • #159
  • Oct 23, 2007 3:24am Oct 23, 2007 3:24am
Quoting iandekoker
Seems like there are a few people trading more than one account. Wow and i thought i was making it difficult for myself trading more than 1 currency pair....lol
geez was that a snide? What wrong with trading more that one account anyway? Anyway i'm sorry for being all heated up by this but i am kind of a little offended by this remark. Lets keep it to the 'so it works for you, hmm good then' attitude.

kind regards
jest
  • #160
  • Oct 23, 2007 3:30am Oct 23, 2007 3:30am
Quoting djmetric
OMG! I don't know why you would say this Marrethiel?!? Fundamentals are the driving forces behind currencies.
Of course they have a big impact but so do speculators, and politicians (imagine some Chinese minister deciding to get rid of a trillion US dollars). I do make note of when the reports occur but don't particularly care which way the move the currencies. I'm happy to make money short or long
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