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20% per month. Is this possible?

  • #81
  • Oct 19, 2011 1:48pm Oct 19, 2011 1:48pm
i think trader should just stop imposing this kind of goal. Just trade well and whatever you make whether it's 20% or 100% or 1%, it is what it is.
I think it's just unnecessary pressure. Instead of trading well, you're trading like you're working 9-5 job or something.
  • #82
  • Oct 19, 2011 7:00pm Oct 19, 2011 7:00pm
Quoting M.A.C.Doug
Its funny you picked the 20%/month figure. Six years ago I knew nothing about trading or the finance world and I didn't want to know. It was all bs by boring old fat bastards and did absolutely nothing for me.

That was until a guy I met said I could conservatively make 20%/month using secret charting technique called - Japanese candlesticks!

I did the figures and worked out I could be a millionaire in less than 3 years starting with 5k. I was hooked, the rest is history. I didnt make a million dollars. I went on to lose 30k in 3 years but, I...
Hi M.A.C. Doug,

How about getting 10% consistently month by month with only starting account of USD1000 account.
And this is done fully by automatically(EA).

Would you interested to test the consistency?
Aim to be consistent on all market behaviour.
  • #83
  • Edited 4:18am Oct 20, 2011 4:08am | Edited 4:18am
Quoting M.A.C.Doug

What I have learnt is that the best way to achieve really good gains, consistently, is to focus on decreasing losses, not on return targets. (aka risk management). The more I do this, the better my returns are.
Here is an example of exactly how I apply that theory in real trading.
I only risked 0.25% per trade.
I only won 50% of my trades but I returned 1.1% in a few hours. This is more than 20% per month if I do it everyday. I have not had a losing day this month so far and I attribute that to my risk management.

Here's what went down today

Euro sells off and reaches support at the end of the NY session. My bias is long given it is the end of the day, price has been sold all session and has hit support. Traders are going to need to close out and book profits which means they will need to buy. I start buying counter trend as usual. I lose my first three trades. My thinking is correct, support holds and my next three trades win. The market closed before my last trade finished which was a bit sloppy of me. I had to overcome a larger spread before finally reaching target

21 pips
1.1% return
0.25% risk per trade
Attached Image (click to enlarge)
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  • #84
  • Oct 20, 2011 10:28am Oct 20, 2011 10:28am
Quoting M.A.C.Doug
Here is an example of exactly how I apply that theory in real trading.
I only risked 0.25% per trade.
I only won 50% of my trades but I returned 1.1% in a few hours. This is more than 20% per month if I do it everyday. I have not had a losing day this month so far and I attribute that to my risk management.

21 pips
1.1% return
0.25% risk per trade
M.A.C.Doug, that means that your stop-loss is only 5 pips, right? I never understand how people can trade with SL 5-6 pips, even M-5 (EURUSD and GBPUSD) hits 5 pips SL almost immediately. I'm not trying to be funny: how do you do this?
Gentlemen always play by the rules. If they can't, they change the rules.
  • #85
  • Oct 20, 2011 10:37am Oct 20, 2011 10:37am
Quoting M.A.C.Doug
Here is an example of exactly how I apply that theory in real trading.
I only risked 0.25% per trade.
I only won 50% of my trades but I returned 1.1% in a few hours. This is more than 20% per month if I do it everyday. I have not had a losing day this month so far and I attribute that to my risk management.

Here's what went down today

Euro sells off and reaches support at the end of the NY session. My bias is long given it is the end of the day, price has been sold all session and has hit support. Traders are going to need to close out and...
weird how you didn't close out that last trade even though it went against you like 10 pips
  • #86
  • Oct 20, 2011 10:37am Oct 20, 2011 10:37am
In my opinion if you have good Money Management you've got all what you need to earn. Of course it isn't easy, but it should be simple. Everything is possible, but not strategy decided about big money. It's all about personal qualities of trader.
  • #87
  • Oct 20, 2011 11:29am Oct 20, 2011 11:29am
Quoting Favorite
M.A.C.Doug, that means that your stop-loss is only 5 pips, right? I never understand how people can trade with SL 5-6 pips, even M-5 (EURUSD and GBPUSD) hits 5 pips SL almost immediately. I'm not trying to be funny: how do you do this?
Quoting hilmy83
weird how you didn't close out that last trade even though it went against you like 10 pips
Yes, I didn't pay attention to it. hilmy83 made a very good point.

M.A.C.Doug, so, if you say you risk 0.25% per trade, do you have a stop-loss 5 pips or you close manually?
Gentlemen always play by the rules. If they can't, they change the rules.
  • #88
  • Oct 20, 2011 12:05pm Oct 20, 2011 12:05pm
Quoting Favorite
Yes, I didn't pay attention to it. hilmy83 made a very good point.

M.A.C.Doug, so, if you say you risk 0.25% per trade, do you have a stop-loss 5 pips or you close manually?
i'm guessing he closes them if there is a 5 minute bar close at 5-6 pips.
i'm just bored today so i'm analyzing this inside out lol
  • #89
  • Oct 20, 2011 12:21pm Oct 20, 2011 12:21pm
Quoting hilmy83
i'm just bored today so i'm analyzing this inside out lol
Gentlemen always play by the rules. If they can't, they change the rules.
  • #90
  • Edited Oct 21, 2011 1:09am Oct 20, 2011 11:06pm | Edited Oct 21, 2011 1:09am
Quoting Favorite
M.A.C.Doug, that means that your stop-loss is only 5 pips, right? I never understand how people can trade with SL 5-6 pips, even M-5 (EURUSD and GBPUSD) hits 5 pips SL almost immediately. I'm not trying to be funny: how do you do this?

I analyse top down to try and get a technical bias and find higher time frame support and resistance. I am watching a 15 minute chart when I trade and rarely go any lower. I am making discretionary decisions on the fly as I play a mostly relaxed game of chess with the market. When you play chess you must concentrate or you will make a mistake and lose. I am watching her moves while I make mine with little risk. I am looking for my set ups and price reaction to predetermined levels. Often I start the game without a trigger while I am waiting to pounce on real time opportunities that are revealed once the game has begun and it has my full attention. I get stopped out regularly and have to re-enter the same trade if its still valid but its all about keeping those losses small and not having to chase to big a target to cover your risk either.
Quoting Favorite
M.A.C.Doug, so, if you say you risk 0.25% per trade, do you have a stop-loss 5 pips or you close manually?

The round dots on an Oanda chart indicate a stop or limit order. All trades in that example were closed this way. I have a preset 4 pip stop and 12pip limit attatched to every entry. The market usual moves before I click so my actual entry is usually a pip or two worse and that is why I lost 5 and 6 pips on those losers instead of the preset 4pips. If I have time, I usually adjust stops and limits after my entry to more suitable locations if necessary. My risk varies dependant on whether I am "in the zone" or not

Quoting hilmy83
weird how you didn't close out that last trade even though it went against you like 10 pips
The last trade had a larger stop because the NY session had closed while the trade was still in play. That was my mistake. I had no choice but to move my stop because spread had widened. I still liked the chances so I stayed in. This meant a 0.75% risk on that trade and a 1:1 risk reward. Like I said, it was a human error but really no harm done win or lose.

I make errors all the time and screw up royally sometimes. I can keep trading without psychological interference with my decision making because my risk is small. I used to walk away all dejected and beat myself up buying tops, selling bottoms and getting rogered. I dont make those really stupid moves very often anymore but even if i do who cares? it is a small loss and I know I can recover. With a clear head, sooner or later I figure out whats going on. Once that happens its check mate.

Quoting VinciPro
In my opinion if you have good Money Management you've got all what you need to earn. Of course it isn't easy, but it should be simple. Everything is possible, but not strategy decided about big money. It's all about personal qualities of trader.
Wish I had this wisdom when I was a junior member


Quoting hilmy83
i'm just bored today so i'm analyzing this inside out lol
Here is something for the next time you get bored
On monday this week I just kept playing in a non stop marathon. I started in front but she managed to get me on the back foot a couple of times. I only win about half the time but I make sure I win more than I lose. Its not rocket science, just risk management

(p.s I was only joking about analyzing - you cant, it has partial take profits and break even lock ins and other trade management tricks that you cant really tell from the picture. Its just a bigger sample to show performance with good risk management)

trades .............46
risk/trade......... 0.6%
wins............... 24
loss................ 22
win rate.......... 52%
pips won......... 330
pips lost.......... 250
net pips.......... 80
average win.... 14.8
average loss... 11.4
conseq wins.... 4
conseq lose.... 4
max draw....... 3.1%
max gain........ 3%
return........... 4.8%
profit factor... 1.3
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  • #91
  • Oct 21, 2011 2:43am Oct 21, 2011 2:43am
I've been trading for around four years now, and have blown my account 4 times in the process. This was a valuable learning experience, and I only wish that I had listened to my own advice at the time.

Four years later, I have done a lot of work on myself, and I'm now well on track to meeting my financial objectives. What I've learned is that this is not a get rich quick scheme. Sure you can make a lot of money in a handful of trades, but if that is the way you trade, you invariably end up giving it all back and more! I established an accountability method by publishing all my trades into a blog, which forced me to defend every trade I made. The last thing I wanted to inform the world was that I was greedy and stupid, so my account has seen consistent gains as a result.

Slow and steady wins the race. Someone once wrote in a forum somewhere, that successful trading is actually very boring. He's right. If you can place a trade without emotion, maintain the discipline to not panic when it goes bad, and honour your trading plan to the letter, then there's no buzz.

Our brains are wired to go for the thrill of the chase. When placing a trade, putting the coin in the slot, or holding your lotto ticket, the same part of your brain lights up as the part that lights up in someone under the influence of an intoxicating substance. Neurobiology tells us that the anticipation of making a lot of money is actually the same as experiencing a 'high', and is a lot more of a buzz for a person than actually making the money. So newbies place a trade for the thrill, and winding that back to place a high-probability trade to actually make money is a lot less thrilling.

Conquer the inner junkie that is hard-wired into all of us, and you will conquer the art of consistently making money. Once you have achieved that, then the simple question is how much money do you want to make? That will dictate what timeframes you trade, what setups you take, and how many open trades you will allow yourself.

I did some simple sums for myself to determine how many pips, on average, I wanted to make, based on my trading plan, a maximum 2% open risk on equity, and a $5k stake. If you make an average of 50 pips a day, and don't take anything out, then you can turn $5k into $50k in about 13 months.

It is really important to be aware of our financial set point. Each of us has an inner 'value', a maximum dollar (or pound, or whatever) figure they think they are entitled to earn. If your trading exceeds that figure too quickly, your psychology will kick in and ensure that you give it all back. You will find yourself subconsciously saboutaging your trades. So you must expand your financial set point, slowly, so your psychology accepts the increase.

Here's my rough calculations. To go from $500 to $5000 takes about 13 months, same for $5000 to $50,000, and $50k to $500k. So you can make $1m in a couple of years, if you don't pull any money out. My plan is to get to my trading equity and then pull out an income.

Of course, if you only make an average of 20 pips a day, it will take you 2.5 times as long!

My Quest to Make a Million Dollars Trading Forex
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  • #92
  • Edited 10:30am Oct 21, 2011 10:04am | Edited 10:30am
Quoting forexmum
Here's my rough calculations. To go from $500 to $5000 takes about 13 months, same for $5000 to $50,000, and $50k to $500k. So you can make $1m in a couple of years, if you don't pull any money out. My plan is to get to my trading equity and then pull out an income.

My Quest to Make a Million Dollars Trading Forex
You said some great stuff in your post about psych but then you finished with this. Dreaming in excel is just silly. It does not relate at all to real trading and is not helpful to noobs to think that it does.
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  • #93
  • Oct 21, 2011 10:16am Oct 21, 2011 10:16am
Quoting forexmum
I've been trading for around four years now, and have blown my account 4 times in the process. This was a valuable learning experience, and I only wish that I had listened to my own advice at the time.

Four years later, I have done a lot of work on myself, and I'm now well on track to meeting my financial objectives. What I've learned is that this is not a get rich quick scheme. Sure you can make a lot of money in a handful of trades, but if that is the way you trade, you invariably end up giving it all back and more! I established an accountability...
everytime i see people post these type of ptotential earnings spreadsheets, i feel like they are participating in mental masturbation. It just makes you feel good about the future...
  • #94
  • Oct 21, 2011 10:27am Oct 21, 2011 10:27am
Quoting Xenaga03
I am not so new to forex, but I would like to know if any professional traders have been able to consistently pull off 20% a month, at least uptil a $100,000 account. Is this possible? I am trying to figure out what my target should be monthly for my return on capital and what figures are realistic.
Of course, it is possible, everything is possible in this markets, if you want 20% per month ,then you must have 1% per day, that means you must rise your risk to 0.5% or 1%, (no more than 2% )
Risiking something means hoping for reward, If you have a trading system that have a winning probabilities by 80% than you can adjust a smaller reward, and vice versa trading system that have a winning probabilities by 20% than you must adjust a bigger reward.
Thats my opinion,

Best regards,

Jin Shan
- 888 Horse Power - Fast Momentum Speed Run Towards VICTORY
  • #95
  • Edited 5:51pm Oct 21, 2011 5:12pm | Edited 5:51pm
Quoting hilmy83
everytime i see people post these type of ptotential earnings spreadsheets, i feel like they are participating in mental masturbation. It just makes you feel good about the future...
I see from your comment I didn't explain its purpose very well. It is good business practice to set financial targets and goals. Successful businesses break that down to daily metrics for example number of cold calls, number of new clients, number of sales made on a daily, weekly and monthly basis.

Why should forex trading be any different? If you want to make a living off it you must treat it as a business.

People think trading forex is a get rich quick scheme that will net you a million dollars in a year. My point is that even with slow and steady, sustained, and reliable earnings, it will take you a long time. It is a useful exercise to measure your earnings journey against some kind of benchmark. When, month on month, you don't achieve even a conservative earnings rate, it tells you that you need to go back to basics.

The spreadsheet is merely an indicator to set expectations. It brings you the warm feeling of achievement, or the harsh kick of reality. If you do not meet your own expectations, then it is an indicator to review your processes and your expectations.

It is NOT meant to be "look how quick you can make a lot of money". If you think that is what it is, you have totally missed the point of benchmarking your progress. It has taken me 4 years of having fun chasing the thrill of the trade to knuckle down and get serious. That spreadsheet tells me that I can't realistically expect to give up my day job until the end of next year, and only if I treat trading as a serious business, never give up, and stick to my trading plan with no deviations. I post my results to the world here, which is a serious incentive to me to stay on track. Others have their own system of accountability that works for them.

On another note entirely, what's wrong with masturbation anyway?

_____________________________
My Quest to Make a Million Dollars Trading Forex
  • #96
  • Edited 9:10pm Oct 21, 2011 5:29pm | Edited 9:10pm
Quoting M.A.C.Doug
You said some great stuff in your post about psych but then you finished with this. Dreaming in excel is just silly. It does not relate at all to real trading and is not helpful to noobs to think that it does.
True. But you do need to set yourself some realistic expectations and plan your journey accordingly. I don't think I explained myself well enough. Too many noobs think they can go professional in x months but you and I both know that is really difficult to do.

A spreadsheet will tell you, under perfect circumstances, what the minimum time will be to reach your destination. For example, I aim to make 50 pips a day, I am currently making around 30. I review my performance every day, and every week, knowing where I am in my timeline as measured against my spreadsheeted plan. If I was trading to buy a car for example, I would now know when, best case, I can expect to go shopping.

A spreadsheet is really a kind of project plan. For me it is a live document, and from a psychology perspective, it is my accountability measure. It keeps me disciplined. Others will have different methods to keep a disciplined approach in reviewing their performance.

You get what you focus your attention on. Now I treat forex trading as a business, with a plan, KPI, and regular reporting, and I am finding I am getting the best results ever. Before I got this disciplined, I was treating it as a fun hobby, which was costing me money!

And thank you for removing the original insults out of your post. Believing something is not possible almost always guarantees that you can't achieve it. I just happen to have a different belief system. If you don't believe I can reach my goal, watch my blog and crow when I don't. But it's not helpful being discouraging and critical to others just because you have your own reality.
  • #97
  • Oct 22, 2011 10:37am Oct 22, 2011 10:37am
Quoting forexmum
...set yourself some realistic expectations and plan your journey accordingly....
Well forexmum, I, for one, get you. I think you make some valid observations and arguments. I wish you well in your endeavor and I plan to keep tabs on your blog, which, in itself is impressive.
Best of luck (although we know luck plays an incredibly small role....)
  • #98
  • Oct 22, 2011 9:02pm Oct 22, 2011 9:02pm
Quoting funwithbux
Well forexmum, I, for one, get you. I think you make some valid observations and arguments. I wish you well in your endeavor and I plan to keep tabs on your blog, which, in itself is impressive.
Best of luck (although we know luck plays an incredibly small role....)
Thanks funwithbux I have read your past posts and wish there were more here like you.

Each of our journeys is unique, but there are some constants common to us all. I am an executive coach by profession, and I have observed several types of people: 1. those who really, really want to change, 2. those who sort of do but don't really believe they can, and 3. those who hide from change behind an "I'm ok it's just the others who have it wrong".

I can immediately help #1s because they are fully committed, but I need to help 2 and 3 to move from interested or not interested to fully committed to CHANGE before I can work with them to achieve results.

I love Einstein's definition of madness: Keeping on doing the same thing, and expecting a different result!

I worked out that if I wanted to actually make money consistently trading forex I had to change the way I was doing it. And it wasn't about finding a better trading system: I got up to $35k in three weeks in a sideways market so I finally knew I was smart enough to read a chart and predict its direction. But my subconscious programming couldn't cope with the success and gave it all away one hot night.

Those sitting reading this who are looking for the holy grail of the ultimate trading system, indicator or expert advisor, worrying about whether the GBPUSD is showing divergence or not, would be wise to take a look at what is going on inside. That may be where your long-term failure really lies.
  • #99
  • Edited 10:30pm Oct 22, 2011 10:17pm | Edited 10:30pm
Just a note about the calculator link from your blog, that might be fine for US based pairs but for others you really need to use this

http://www.earnforex.com/position-size-calculator

Do you just do a basic fixed position size & stop for every trade, or do you use proper position size according to your stop distance?

If you find you are getting stopped out a lot, you may want to reconsider your options.

For example, here is a series of 4 trades I did on Friday, just happened that the first 2 are round numbers lot sizes, they are all calculated from the stop distance and 2% risk.

Hope that helps.
Attached Image (click to enlarge)
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It takes a lot for me to IGNORE you, but you can try.
  • #100
  • Oct 22, 2011 10:32pm Oct 22, 2011 10:32pm
Quoting Erebus
Just a note about the calculator link from your blog, that might be fine for US based pairs but for others you really need to use this

http://www.earnforex.com/position-size-calculator

Do you just do a basic fixed position size & stop for every trade, or do you use proper position size according to your stop distance?

If you find you are getting stopped out a lot, you may want to reconsider your options.

Oh nice, thank you!

I don't get stopped out much, mostly because I use small lot sizes and large stop losses, which are calculated based on the type of trade and the risk of the trade. I use a combination of fibonacci, news/fundamentals, harmonics patterns, and intuition. My hard stop is placed outside those parameters at 5% equity.

But I like this calculator. I will be using it to calculate the position size, not the stop loss - that is based, as I said, on the individual trade, where I think it will go, what the risk of a reversal is before it reaches my TP, and how high or low I think it will go (which is where I use the fibonacci).
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