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Are 48% of oandas accounts profitable?

  • #21
  • Edited 11:44pm Nov 21, 2010 11:32pm | Edited 11:44pm
Quoting newyear498
Actually.. your right.. I was raised as stock market being a zero sum market but I just saw this... http://www.investopedia.com/terms/z/zero-sumgame.asp

but I was never foolish enough to say 50% of oanda would win and 50% would lose.. I did mention other players in market.. but anyways investopedia says its not a zero sum so I take back what I was taught earlier..

anyways its still a disadvantage market.. big players win overall .. but all that money has to trickle from somewhere.. if I make money someone is losing money.. its...
Myth #2 "their spreads are sometimes kinda sorta better than some brokers depending on when you trade and what pair so that explains EVERYTHING!"

I use them and their spreads tend to be good but I also use other brokers and their spreads can vary more widely than the others depending on the time of day, the pair, and what's going on. I'll bet if you averaged out all their spreads over the top 20 pairs for a whole day they would be no better or worse than any of the other top brokers. If anything they would only be marginally better and sorry...but marginally better is not going to make the difference between 50% profitable traders vs 25-35% that the other brokers reported.

IMHO it's the leverage. Oanda was the only one of the reporting brokers limiting their traders to 50:1 I believe. If the other brokers report more similar percentages after the current reporting period where they are also 50:1 this will be confirmed.
  • #22
  • Nov 21, 2010 11:39pm Nov 21, 2010 11:39pm
Quoting nubcake
use your own brain and don't rely much on website definitions.

according to investopedia (whatever) it's not zero sum in stocks because wealth can be created in stocks?...
I'll settle for a beachfront condo on an island
  • #23
  • Nov 22, 2010 12:29am Nov 22, 2010 12:29am
Quoting hubbahubba
Sorry but you are 100% wrong. 50% of Oanda individual retail traders are profitable has nothing to do with the other 50% not being profitable. This statistic has no correlation whatsoever with the overall forex market. It does not take into account the people who actually effect the market (which are NOT..NOT...not indvidual retail traders). Those 50% of Oanda traders plus all other individual retail traders all over the world with all the other brokers are nothing but a few mosquitos on a elephants butt!

SO, to summarize...your observation is...
I was going to clarify on this also, but you beat me to it. Non retail traders are the overall winners and retail traders are the overall losers. That's not to say every retail trader is a loser.
  • #24
  • Nov 22, 2010 12:31am Nov 22, 2010 12:31am
I've seen this debated quite a bit. I have a book by Michael Covel which argues FX is a zero sum game but equally I know George Soros is of the opinion it's not. I think the later is more of an authority on the subject.

My argument would be that not everybody is playing the same game.... First example would be if an importer/exporter is on the other side of your trade they won't be reversing it so no PnL.... I can't really defend an argument that they would lost in the way of foregone earnings but I would stress their motivation is not to make money from any currency fluctuation and it is a biproduct.

Second example is bullet proof. I'm a bank and i sell an option for $100 to a hedge fund. The bank hedges the delta and when exercised has lost 50 of the 100 it was paid. the HF did not delta hedge and is up 50. All the banks hedges were with Bank Y closing previously held positions and consequently made money.

Bank up 50
HF up 50
Bank Y up $$ too
and nobody looses

I'm very interested in the oanda numbers and it would be nice if you could see behind them. Although I wouldn't be surprised if by paying interest they have created an anomaly.... you've got to remember that it is their interest to show how people make money with them!!!

would be interesting to see how mcuh the winners make against how much the losers lose!!!
  • #25
  • Nov 22, 2010 12:37am Nov 22, 2010 12:37am
Quoting hubbahubba
Myth #2 "their spreads are sometimes kinda sorta better than some brokers depending on when you trade and what pair so that explains EVERYTHING!"

I use them and their spreads tend to be good but I also use other brokers and their spreads can vary more widely than the others depending on the time of day, the pair, and what's going on. I'll bet if you averaged out all their spreads over the top 20 pairs for a whole day they would be no better or worse than any of the other top brokers. If anything they would only be marginally better and sorry...but...
The average spread doesn't have much to do with it. I use them also and their spreads are lower than most brokers (especially market makers) throughout most of the day. When they are not higher then DON'T TRADE. You just have to wait for the spreads to come back down to place your trade. I do agree that their 50:1 margin contributes to their stat. I believe the biggest reason Oanda has a higher percentage is they allow you to trade as little as 1 unit.
  • #26
  • Nov 22, 2010 12:40am Nov 22, 2010 12:40am
Quoting zentrader108
I've seen this debated quite a bit. I have a book by Michael Covel which argues FX is a zero sum game but equally I know George Soros is of the opinion it's not. I think the later is more of an authority on the subject.

My argument would be that not everybody is playing the same game.... First example would be if an importer/exporter is on the other side of your trade they won't be reversing it so no PnL.... I can't really defend an argument that they would lost in the way of foregone earnings but I would stress their motivation is not to make...

I trade Oanda and the interest is so small compared to what I trade it's completely inconsequential. Besides, as I have already said in a previous post...Oanda did NOT include dormant accounts. If they did then interest could have skewed the numbers but they have publicly stated that they did not include dormant accounts.
  • #27
  • Nov 22, 2010 1:14am Nov 22, 2010 1:14am
Quoting CindyXXXX
GFT who is also second on that list dont use metatrader either

Right. Metatrader is psychologically geared to make you lose money at the way is positions leverage and the the color red. If you want to make money as a trader, step one is to get rid of Metatrader
  • #28
  • Nov 22, 2010 1:58am Nov 22, 2010 1:58am
Quoting Marv
I find it really weird that people don't see that these stats are perfectly normal. They actually conclude that this disproves the 5% percentage of consistent winners.
And that is why they are losers.

Quote
who cares if you buy your broker a porsche along the way

Cost of doing business. If buying them a Porsche is what it takes to by myself a Zonda, so be it.

Quoting newyear498
big players win overall
Forget "big players". The biggest participants are pools of dead money. It is these participants that sustain the feeding frenzy of the smaller but sharper participants.

Quote
20% could take the money from 80% of the people (aka recent US ressesion with a few key players screwing the little guys over (selling loans they know cant be paid off) )

Not the topic, but I have to step in here. The little guys screwed themselves by taking loans they couldn't afford.
  • #29
  • Nov 22, 2010 2:03am Nov 22, 2010 2:03am
Quoting zentrader108
I've seen this debated quite a bit. I have a book by Michael Covel which argues FX is a zero sum game but equally I know George Soros is of the opinion it's not. I think the later is more of an authority on the subject.

My argument would be that not everybody is playing the same game.... First example would be if an importer/exporter is on the other side of your trade they won't be reversing it so no PnL.... I can't really defend an argument that they would lost in the way of foregone earnings but I would stress their motivation is not to make...
Where is bank X or Z or X and Z ....... ?
Trading is the game of fear and greed.
  • #30
  • Nov 22, 2010 3:02am Nov 22, 2010 3:02am
Quoting newyear498
it may be a trillion dollar market but the main winners are brokers.. banks.. and the U.S. government (for taxing the US forex traders who profit) they are the real winners.. like the house at a casino..
I would say there are some forex traders who are the real winners.

My forex manager has paid for past 10 years average profit of +35% per annum without compounded interest.
  • #31
  • Nov 22, 2010 8:55am Nov 22, 2010 8:55am
I never said the little guys can't win.. I am simply saying the banks, brokers, and governments taxing are surly taking in the majority of money..

This thread is getting really lame because hubbahubba started debating with me about "myth 2" on speads..

I'm getting really tired of having someone pick a single small aspect of what I say and argue against it... when I am talking about the larger picture here.. I never said "oanda is better cuz of speads" no that is one small aspect.. good speads and larger aspect is fair broker with honest charts. doesnt mean I'm saying other brokers arent ether

and again never said little guy can't win.. but its common sense.. if all the little guys make 10-30% in forex.. well your broker made .9 pips every trade you made..

and US government is taking 5% of your profits from every trader in US..


So pick another small thing I said and argue about it.. overall it doesn't matter the truth lays somewhere in the middle of everything we said.. and I agree on that!
  • #32
  • Nov 22, 2010 10:14am Nov 22, 2010 10:14am
Well said Newyear498 and Mr J.

Quoting hubbahubba
IMHO it's the leverage.
haha I knew you were gonna limit it to that.

I disagree. The majority of traders will still have the same average risk per trade regardless of whether they trade with Oanda (50:1 leverage) or another broker with 200:1 leverage. Limited leverage may have some influence, but the spreads and other factors, even though small, probably have more statistical influence.

The stat is perfectly normal given the nature of the retail forex trading game along with Oanda's trading conditions.
  • #33
  • Nov 22, 2010 10:19am Nov 22, 2010 10:19am
Quoting Marv
Well said Newyear498 and Mr J.



haha I knew you were gonna limit it to that.

I disagree. The majority of traders will still have the same average risk per trade regardless of whether they trade with Oanda (50:1 leverage) or another broker with 200:1 leverage.
Yes, it's obvious you do not use Oanda and are desperate to prove you are right about something.

Best of luck with that. It's a great characteristic to have as a trader.........
  • #34
  • Nov 22, 2010 10:22am Nov 22, 2010 10:22am
Quoting hubbahubba
Yes, it's obvious you do not use Oanda
Sorry but I do. They're currently the best MM broker around.

Quoting hubbahubba
and are desperate to prove you are right about something.

Best of luck with that. It's a great characteristic to have as a trader.........http://cdn.forexfactory.com/images/s...lling_eyes.gif
wow...
  • #35
  • Last Post: Nov 22, 2010 12:08pm Nov 22, 2010 12:08pm
I'm so over this thread :-p
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