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Do Losers Make Winners in Forex?

  • #1
  • First Post: Edited 9:41am Jan 28, 2008 8:58am | Edited 9:41am
Hello my FF friends ,

I always see that some newbie forex traders (or maybe even some professionals) think that for the winners to win in forex, we have to have some losers to lose.

On the other word, they think that forex is like gambling that has to have losers to have winners otherwise nobody will make any profit.

What do you think? Do you think they are right? As a forex trader, the money that I make is taken from the losers?

I have some good reasons that this is absolutely wrong but I am eager to know what do you think because there are a lot of good traders here on FF. I will mention my reasons then.

Happy trading
  • #2
  • Jan 28, 2008 9:06am Jan 28, 2008 9:06am
Quoting Vahid
Hello my FF friends ,

I always see that some newbie forex traders (or maybe even some professionals) think that for the winners to win in forex, we have to have some losers to lose.

On the other word, they think that forex is like gambling that has to have losers to have winners otherwise nobody will make any profit.

What do you think? Do you think they are right? As a forex trader, the money that I make is taken from the losers?

I have some good reasons that this is absolutely wrong but I am eager to know what do you think because there are a lot of good traders here on FF. I will mention my reasons then.

Happy trading
whaaaa??
  • #3
  • Jan 28, 2008 9:10am Jan 28, 2008 9:10am
ummmmya, the winners reap the benifits of the losers losses........as sellers bail out of positions the buyers make money.........now there will always be the winning sellers that have been in a position long enough that when they bail they make money...but the lions share have much to weak of positions to get out in profit.....you can't make money until someone losses it..whether it is acual loss of capital or loss of part of a profitable position
  • #4
  • Jan 28, 2008 9:12am Jan 28, 2008 9:12am
I believe it is so in the INTERBANK market, meaning through the EBS.

If you buy something, somebody has to sell you something so the person that sells, might be someone who HAD a long and wants to take profit.

However, the market is filled with bank dealers that will go short as often as long and when you want to buy something, it is often a dealer that goes short something which fills your order.

Therefore if you profit, the person who sold you your contract would be making a loss.

For the retail platforms, it all boils down to how often are your orders actually transacted with other customers? More often than not, the brokers actually take the other side of your deal and makes the market. So in effect, you are trading against your broker.
  • #5
  • Jan 28, 2008 9:36am Jan 28, 2008 9:36am
Google "zero sum game". Absolutely imperative that you understand this concept before trading FX.
  • #6
  • Last Post: Jan 28, 2008 9:41am Jan 28, 2008 9:41am
Absolutely right.

In every market must be losers in order to have some people win money otherwise there is not market.

But forex is not differrent than any other kind of business, for example the car dealer buys the car for $4000 and sells for $6,500 . Nobody thinks that they people who buy the cars he sells are losers.. but in a way they are as they buy it more expensive than the dealer.

You donot have to feel guilty if you are a winner in forex cause nobody forces anybody to be involved especially when there is a risk warning that the investor can lose all or a part of his money invested.




Quoting Vahid
Hello my FF friends ,

I always see that some newbie forex traders (or maybe even some professionals) think that for the winners to win in forex, we have to have some losers to lose.

On the other word, they think that forex is like gambling that has to have losers to have winners otherwise nobody will make any profit.

What do you think? Do you think they are right? As a forex trader, the money that I make is taken from the losers?

I have some good reasons that this is absolutely wrong but I am eager to know what do you think because there are a lot of good traders here on FF. I will mention my reasons then.

Happy trading
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