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Why do Newbies Lose?

  • #41
  • Feb 28, 2013 11:08am Feb 28, 2013 11:08am
The get rich analogy is true for all traders and not just the noobs throwing their hard earned money into the ring in hopes of getting lucky. Yes, trading successfully requires skill but it is going to take a lot of grunt work to get there. There's no easy shortcuts, so would advise the noobs to review some of the old threads, stickies and other edu resources and move on from there..
  • #42
  • Feb 28, 2013 1:39pm Feb 28, 2013 1:39pm
Quoting rooicol
Hi all,

Just wondering what exactly do newbies do to lose?

I mean when you open a trade, regardless of any analysis you do, you are issued a 50:50 chance of winning/losing, so how do you lose overtime?

Well, i guess the first thing is trading cost, every trade you make it will cost you about 3 pips, so if a newbie makes 100 trades, 50 wins and 50 losses of equal size, they will end up down 300 pips. I think newbies have a tendency to make many many trades in a short period of time, the market rise a few pips and they buy, the market falls...
I personally feel the single biggest factor is poor risk management. I always aim to take trades that will make me at least twice of what I risk (a very common strategy). I've seen plenty of newbies who just pick an arbitrary place to put their stop and take profit; sometimes even out-sizing the distance from entry to take profit with their stop. You simply don't make money that way. Newbies have to learn how to place a stop in the right place on a trade with the highest probability of success. Normally that stuff should be solidly laid out in their trading plan.
  • #43
  • Feb 28, 2013 1:40pm Feb 28, 2013 1:40pm
Hello everybody

I m cesarioto and I am a newbie

I ve been trading for 2 and half week only,since february 8th,but it was just to get some confidence with the broker, I wanted to start on next tuesday..

Well, in 4 hours trading,"just to have a look", I gained 360€, with a micro account. Obviously, on the next wednesday I lost almost everything I got, I went up again, only to lose everything last week. Last Thursday I put once more 250 €, once again, up down, up down...zero!!!

Yesterday I put 250 € again, and I hope to have realized my big mistakes...
Too much and high risk, no patience and no discipline. That s the way on my desk I ve written on a sheet, "Geduld, Disziplin, kein Gier", it s german and it means: Patience, Discipline, no greed.

Well, I hope to respect these 3 principles, and become a newbie who doesn t lose anymore.

Your cesarioto

Ps: nice to be here
  • #44
  • Feb 28, 2013 9:47pm Feb 28, 2013 9:47pm
Quoting cesarioto
Hello everybody

I m cesarioto and I am a newbie

I ve been trading for 2 and half week only,since february 8th,but it was just to get some confidence with the broker, I wanted to start on next tuesday..

Well, in 4 hours trading,"just to have a look", I gained 360€, with a micro account. Obviously, on the next wednesday I lost almost everything I got, I went up again, only to lose everything last week. Last Thursday I put once more 250 €, once again, up down, up down...zero!!!

Yesterday I put 250 € again, and I hope to have realized...
streben nicht gierig zu sein (I may have botched that, I'm only just learning German.)

You're blowing through cash though, und it doesn't sound like you are in a position to be learning from your mistakes. The only thing worse than blowing out an account is not learning from it and repeating the mistakes. Losses are part of the game, and so are mistakes (we're all human, even the pros.) That's why a lot of seasoned traders call mistakes "market tuition", since they are paying to learn a lesson. It stops being 'tuition' and becomes 'dumb money' if you just make the same mistake again and never learn.

Honestly, you should pause what you're doing and take a step back; the bad habits you are building right now are going to be hard to break later.
FXGears.com
  • #45
  • Feb 28, 2013 9:52pm Feb 28, 2013 9:52pm
Quoting cesarioto
Hello everybody

I m cesarioto and I am a newbie

I ve been trading for 2 and half week only,since february 8th,but it was just to get some confidence with the broker, I wanted to start on next tuesday..

Well, in 4 hours trading,"just to have a look", I gained 360€, with a micro account. Obviously, on the next wednesday I lost almost everything I got, I went up again, only to lose everything last week. Last Thursday I put once more 250 €, once again, up down, up down...zero!!!

Yesterday I put 250 € again, and I hope to have realized my big...
The problem that you have is you don't know what you don't know, and it will hurt you. I've been at this for a little over two years now and I only recently started to understand how this game is played. Stop throwing your money away and open a demo account to test ideas out. I know you're probably going to ignore my advice but if you do it will be at your expense.
  • #46
  • Mar 1, 2013 3:56pm Mar 1, 2013 3:56pm
i don t know why, but my reply and answer for Jack and the Kanzler has not been published..ok, no problem..

I ve just written that I really believe that the system I use, works, but I must take my greed and impulsivity under control.

Once more, thanks for your suggestions, I ve been learning forex and using demo accounts since the beginning of this year, and only 1 month later I started trading with real money

Keep safe

cesarioto
  • #47
  • Mar 2, 2013 11:11am Mar 2, 2013 11:11am
Very interesting indeed. Does newbies really lose more than the commission and spread on average? If they clearly lose more than two times the spread and commission they would be profitable by doing the opposite, that is selling when they feel they should buy and vice versa.

I do black box trading profitably, but I've noticed that whenever I try to trade manually I lose. There's probably a psychologic reason. Markets are ranging most of the time which means you should have a tighter take profit than stop loss as default. I unfortunately do the opposite when I trade manually due to fear and greed.
  • #48
  • Mar 5, 2013 4:35am Mar 5, 2013 4:35am
Quoting cesarioto
Hello everybody

I m cesarioto and I am a newbie



Ps: nice to be here
Hi there,
Yes, the market is going to seem overwhelming, for all newbies. The good news, you know what you need to work on and what you must not do..so take some time to review the info in the forum, review some of the online edu courses and do a demo..
  • #49
  • Mar 5, 2013 1:31pm Mar 5, 2013 1:31pm
Hi Forexnuts
thanks for the encouraging answer, and I m really doing this....
It s almost a month that I m trading with real money, after only 1 month learning and using demos, I know that I have a lot more to learn. I think by the end of march, I will take the first decisions on going on with trading or even not...

Keep safe ;-)

cesarioto
  • #50
  • Mar 6, 2013 8:55am Mar 6, 2013 8:55am
You're welcome and yeah, when you think you have learnt everything, you find there's a whole new chapter. I could point out to the pre-1980's and today and you'll see the huge advantage of forums like Ffactgory and Babypips..
Please post any query you may have and we'll be more than happy to help you out but remember, you'll have to do the grunt work and DO NOT FALL for the snake oil salestalk (like EAs and other variants), for the simple reason - none exist.
Good luck!
  • #51
  • Mar 7, 2013 6:20am Mar 7, 2013 6:20am
where did roicool go?
wo-yoy! wo-yoy! wo-yoy! wo-yoi! wo-yoy-yoy-yoy!
  • #52
  • Mar 9, 2013 2:40am Mar 9, 2013 2:40am
I am not sure about all newbies that why they loss but I am sharing my experience that why I lost in beginning. The first reason was entering the market without thinking and using high lot on small capital. Then I was not making good entry points and exit points and it cause me to stuck in difficult situation. The lack of patience is causing all the newbies to loss because they just don't wait for good opportunities.
  • #53
  • Mar 9, 2013 5:07am Mar 9, 2013 5:07am
Yup, you should have started out with a demo instead of a live account - trading without a strategy is not a good idea, it is akin to taking a shot in the dark and hoping you've hit that pesky badger..
  • #54
  • Mar 9, 2013 2:36pm Mar 9, 2013 2:36pm
This is my own personal experience but these also seem to be the most common mistakes made by new traders:
1- Overtrading, this is, not having the discipline to wait for the setup to develop. Most of the time I found myself pulling the trigger way before I got confirmation that an actual setup was in place
2- Overleverage, greed takes over, most of us want to make a million dollars in one or two weeks, the result?, you bust your account without even having a chance to actually learn how to trade...
3- After #1 and 2 above occur then you get scared of placing trades when if fact you SHOULD be now trading !!

This is a simplistic view but very common in most new traders!

Oz
  • #55
  • Mar 10, 2013 1:36pm Mar 10, 2013 1:36pm
for my answers are...

1. newbies even oldbies do not know what is current trend.
2. chasing the trend too often.
3. did not following the rule of the system
4. when trend is reversed, did not closed the order and hope it will keep going.
5. money management.
  • #56
  • Mar 12, 2013 7:37am Mar 12, 2013 7:37am
As a newbie...how long did it take you to wipe out your first account?
  • #57
  • Mar 12, 2013 11:23am Mar 12, 2013 11:23am
As a newbie, it took me just a few days to wipe out my account - on my next try, lasted a month, before the eventual end..
Those were the days, when you think you know everything..
  • #58
  • Mar 12, 2013 11:31am Mar 12, 2013 11:31am
I think initially when you start making profits you become overconfident about your trading ability and eventually end up over trading until you wipe out your entire account.
  • #59
  • Mar 12, 2013 12:17pm Mar 12, 2013 12:17pm
Rightly said tony_montana

When I started trading in our stock exchange, same thing happened to me. I got some early profits so re-invested and was increasing the investment quickly. I ended up with net loss. I was lacking the patience as like all the newbies! I am new to forex now and in the process of selecting the perfect broker first since every broker is not perfect for everyone.
  • #60
  • Mar 13, 2013 8:41am Mar 13, 2013 8:41am
Quoting muwhahaha
I started trading last September and I haven't completely drained my account yet(micro account) but I went into trading with a trading system that was based on all indicators. I also was pretty greedy and risked too much per trade. If I had a losing trade I would get very paranoid about my next trade so I wouldn't take the signals my system provided. Then, I would see the would of been trade go up and then try enter in on the trend at the end. So, I was basically buying at the high. Isn't it supposed to be the other way around?

I am...

Trading takes experience, a lot of time and money or lots of discipline....
Choose one.
Experienced traders lose daily but it never hurts.
So do they make profits daily.

Be patient, don't despise the small money account.

Happy trading.
Danny
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