Menu
Sister Sites

Options

Bookmark Thread

First Page First Unread Last Page Last Post

Print Thread

Similar Threads

Who has ever tried to get a bank loan for trading? 57 replies

FXCM CEO Drew Niv speaks on the company’s results, Leucadia loan 0 replies

Bank loan for traders 70 replies

How to program the std indicator to take to take price from other indicator windows 0 replies

Anyone here trading AUD/USD or USD/AUD tonight regarding AUS Home Loan Report? 1 reply

Attachments: Take a Loan to Trade?
Exit Attachments

Take a Loan to Trade?

Knowing what I know now, all the experience I attained and taking everything into account as much as possible in making the decision....

I would advice not to borrow money to trade.

=============
Successful entrepreneurs: Contrary to popular belief (and publicized through the media), when they use OPM or take out a loan, can actually support those loan through their other incomes... which they failed to explained to the public. It's amazing how they turned a business into a million dollar business or how they turned their investments into millions.

Here is the truth which they failed to explain and which a lot of people are consciously unaware. It's a frightening truth; not everyone is made to be rich and wealthy, someone has to do the labor/work. Not everyone are meant to be rich and wealthy (it's a kick in the nuts, I know). The system was not made for everyone to be rich and wealthy.

As much as they try to tell you that if you just do this and that, then you will be successful. Guess what, they lied to you... because for the fact that when someone win, someone has to lose. If the property investment book showed you how to accumulate even just 5 properties, not everyone will succeed because there is not enough supply. If you give everyone 5 properties so that "they can be rich enough not to work", the economy will fail, and there is no-one to rent the place because everyone has their own.

There is only one determining factor into wealth which they failed to explain and I'm going to express it vaguely:

An excess (excessive) amount of positive cashflow.

  1. Borrowing doesn't do you any good if you can't support and pay your loan.
  2. Borrowing becomes a great disadvantage to you if your debt is greater than 3x of your cash flow.
  3. Borrowing becomes a great disadvantage the longer you have it.
  4. Borrowing was designed to enslave you, to work all your life and at the end have little or nothing to show for it.

The only time you would use OPM is when you got all your legal papers organized. Meaning all your assets are secured, that when the business venture failed, the court can't take your assets away.


Uh oh.

That'd be a VERY bad idea, which I guarantee you'll regret.

In trading, especially in a market like foreign exchange, you will lose. You will lose again. Then, you'll lose again.

After a few years or so of losing, you'd probably wise up to the point of breaking even. A bit later, maybe you'll make a profit.
  • Post #23
  • Quote
  • Edited at 9:47pm Oct 14, 2012 9:35pm | Edited at 9:47pm
Quoting newyear498
Would it be advisable to take out a loan and use that money to make speculative trading positions in the Forex market?
Holy crap NO!

CP did a good job detailing why, so have others in this thread.
FXGears.com
biggest fool ever exist on earth, who takes loan for trading..
dont even think about it, trading real money need a rock solid/very strong psychology, even Warren Buffet will not recommend this.
never ever do such stupid thing, and please ignore all those who supports such stupid thing,, they are just affiliated with some brokers and screwing peoples life is there profession.
Let's not beat the guy up; he was asking a question not making a statement.
FXGears.com
There are simply so many misconceptions, preconceptions and unadulterated fallacies here that..............

.... a reply could not be made without getting someone's bowels in an uproar.

Therefore,
we should do what???

Suggestion, please.

Anyone??
When the Joker is in the deck.. fear not and play it well
Good Emo, Good MM , Good Attitude. Why not
Quoting 2013
Good Emo, Good MM , Good Attitude. Why not
That's as good as any.

But it could be interesting to delve into a discussion regarding loans, leverage and so much more.

There are those who believe leverage (basically a loan) in the forex market is a bad thing. Of course, that depends on the amount.

There are those who believed leverage in the property market was a good thing.

Some people made millions. Others did not.

Of those who did make millions via the use of leverage, what percentage of those would you guess are in favor of leverage/loans.

Of those who lost.... you get the picture.

IMHO, trading as an individual is a bit different than a "bricks and mortar" business or an aspiring Internet business.

Try convincing your banker (that you're worthy of a loan based on trader credentials) and when you do................

But really.............. where would ANYONE be without leverage?
Paid cash for your house?
Car?

Governments of the World don't use leverage and never try to limit it ?
When the Joker is in the deck.. fear not and play it well
Just as an afterthought;
Sometimes it seems that those who wish to regulate leverage are those who use it most.

http://www.usdebtclock.org/world-debt-clock.html

It's interesting to note the difference between public and external GDP ratios. This isn't "media driven" btw.....

The real problem with leverage in FX is that a lot of "peeps" who lost their ass (the majority) whined to the politician of their choice saying that it was someone's' fault other than their own.

Moe... you can take it from there
When the Joker is in the deck.. fear not and play it well
to those who think I'm stupid for taking a loan out..

its just ironic because they themselves over leverage with borrowed money in FX

and margin traders do the like


that was mainly my point but I see my hint before at it.. as will this post.. be lost in the middle eventually


Quoting newyear498
to those who think I'm stupid for taking a loan out..

its just ironic because they themselves over leverage with borrowed money in FX

and margin traders do the like


that was mainly my point but I see my hint before at it.. as will this post.. be lost in the middle eventually


Actually, there is one crucial difference: say you have 10,000 dollars and put into a trading account. If you lose it, it's just your money, you don't owe anybody anything anymore. You'll just be broke, and maybe still have a job. But if on top of that you borrow another 90,000, put into a trading account with your 10,000 and lose the entire 100,000, you have lost another 90,000 dollars which you didn't own and which you have to repay, with interest and penalties accruing every day.
Quoting newyear498
to those who think I'm stupid for taking a loan out..

its just ironic because they themselves over leverage with borrowed money in FX

and margin traders do the like


that was mainly my point but I see my hint before at it.. as will this post.. be lost in the middle eventually


yes u are correct people trade with leverage money, but then we all know what happens in the end.
Scared money is loosing money. Period. Borrowing what you cannot afford to lose is scared money for most common mortals.
Fuck Forex Factory.Wake up people.
Quoting hawkman
Actually, there is one crucial difference: say you have 10,000 dollars and put into a trading account. If you lose it, it's just your money, you don't owe anybody anything anymore. You'll just be broke, and maybe still have a job. But if on top of that you borrow another 90,000, put into a trading account with your 10,000 and lose the entire 100,000, you have lost another 90,000 dollars which you didn't own and which you have to repay, with interest and penalties accruing every day.
Bankruptcy is an option.
Quoting neil324
Bankruptcy is an option.
Not for me hahaha

anyone who has to file is so screwed for life..


It comes two fold.. file for bankruptcy.. go find a sugar daddy and be a little bitch


otherwise your going to always be a 9-5 work your ass off to pay rent till the day your day with no option for starting your own business or getting a new car
When I just started trading I was a newbie with a big ego after I bought this amazing strategy, and only after a few wins did I decide to go live and took out a loan.
I crashed that account within 5 trades, and took me 5 years to pay off the loan, as I was so disgusted with myself that I didn't want to trade anymore.

Just be very careful before taking a loan for trading especially if you are new to any type of trading.
I don't think you need more than 500 bucks to test your strategy and prove yourself in trading a method.

One problem that often occurs is: when the method is working, the mind starts telling you that if only the account were 100 times bigger, then look how much money I would be making..... If that thought ever crosses your mind, please recognize the huge red flag that just went up.

Using OPM for trading may be a good idea sometimes, and for some traders. Just be sure that you recognize the risk and see beyond how much you can "make". Because the better question is always, "How much can I lose ??"
  • Post #40
  • Quote
  • Edited at 6:49pm Oct 15, 2012 5:48pm | Edited at 6:49pm
Quoting Price
One problem that often occurs is: when the method is working, the mind starts telling you that if only the account were 100 times bigger, then look how much money I would be making..... If that thought ever crosses your mind, please recognize the huge red flag that just went up.

Using OPM for trading may be a good idea sometimes, and for some traders. Just be sure that you recognize the risk and see beyond how much you can "make". Because the better question is always, "How much can I lose ??"
Not being negative here, just trying to be a bit realistic. Hell, we all have dreams. Some (very, very, very few) do make it. Just be prepared to pay the price if you are not one of them.
Fuck Forex Factory.Wake up people.
1 trader viewing now