Need luck or skill for trading?

totally agree with him.

smaller TF need more skills, psychological management, etc etc compared with higher Timeframe.

gambling need luck, trading need skill

gambling doesn't need any analysis, any reason to entry, any plan, or anything -> just put your bet and wishing you win the bet
trading need analysis, any reason to entry, exit plan, etc etc -> watch PA and see what happen next.

both trader and gambler looks the same, but they differ each other

I do not rely on luck in forex. LUck can not make trades for us Only our skill and experience give us profit . We need skill for working in this market. Skill make us lucky when we get our goals from forex trading. Peole who wait for luck can not run withthis market.

If you are counting on luck for your trades, it means that you have no system or that you didn't plan for a loss in your system and once you are losing you pray and hope on some luck to recover, so you see, there should be no place for luck in trading which doesn't mean that from time to time you will not have luck.

There is a trading system which needs almost 99.99% of luck, it's called lottery

Lottery is 100% luck.

Oh! I letf 0.01% of skill to put the right count of numbers on the ticket

Ideally you want both!
I know of many lucky people you tried trading and hit a few big trades but weren't able to maintain because of lack of skill.
When you develop your skills, lucky scenarios seem to follow, your mind is more confident in its abilities and you subconsciously expect to win.

" If you have no confidence in self, you are twice defeated in the race of life. With confidence, you have won even before you have started "

from experience
I now have more confidence in small time frame


S.C.

Simple.

gamblers need luck

traders need skills to do technicals and fundamentals analysis.

i already post this example in different forum, it is just an example and i don't expect everyone to agree. but i hope it can change your view.

if someone can't explain why they took a trade or not, and can't explain what is the reason behind the their decision, i think they are in a land of confusion and i categorized this person as a gambler.

a gambler is a risk taker who take a BET without knowing what they are doing and winning or lossing is based on his believed on his luck and psychology.

a trader is also a risk taker and ready to take the risk/BET, but the real different is a trader ALREADY have a PLAN to manage their risk on their decisions and already do some analysis to support their belief no matter what the result is win or lose as long has they have a good expected return.


let's take contrast example. There is 2 person in a casino and observe the baccarats table (baccarats is the cheapest and easiest game in casino with a lowest dealer advantage compared with any other game). This 2 person have the same initial amount of capital (let's assume $1000) and the table has minimum bet of $10 (to make the calculation easier). In baccarat game, the result is only BANKER, PLAYER, and TIE. If the result is TIE, No transaction between bet on banker and player side so let's assume the result is only BANKER and PLAYER and ignoring TIE.

After several results, here come the moment when the BANKER has win 17 times straight in a row. these 2 person ready to take action since both of them spot an opportunity to make profit.

let's assume the 1 to 17 result is Banker. the rest result is actually random but for the next 3 result (let's assume again) is Banker, Banker and Player

person no 1, after he spot this opportunity, he believed that and got some strong feeling that the next (18th) result is PLAYER. he put his bet $200 to player side. and he lost in his first bet. On 2nd bet, he still believed that the next result would be Player, so he put martingale strategies on his bet which is $400 (to cover his first lost). and he is also lost in his 2nd bet. On 3rd bet he is ready to "follow the trend" and go with BANKER side and put $400 (his money left) and expect he covered some of his losses. Since the result is Player, he lost all of his money and go very depressed and leave the table and promise to himself not to go to casino again. (it is funny but most of the people would do the same. Don't know this person will come back again or not in the future is beyond of the scope of this example .

On the other side, person no 2, also spot this is as a profit opportunity. He build his plan and ready to take action. He already calculate all the risk, capital and see expected return on his favor even the next following result is still random. and what he has to do is following his own plan no matter what happen next. His calculation on probabilites is simple. He assume within 100 round, the total result will be 50 result on BANKER side and 50 on PLAYER side (based on 50-50% probabilities). He also assume that the first 17 rounds already on Banker side, so that the next 83 result would be approximately 33 Banker and 50 Player. If he ALWAYS bet on PLAYER side with the minimum bet on the table of $10 in each round for the next 83 round. His expected return is $170 (33 lost and 50 win and multiplied with $10) minus dealer advantage and his maximum lost is $830 (plus dealer advantage) in a very unlikely condition but never say never . Based on his calculation he build his own plan, ie he is ready to take Maximum 83 round and if he already got $170 profit he will leave the table and go home very happy.

from the above example, both person doing the same ACTION ie GAMBLING on such a profit opportunity. but actually they are different each other, person no 1 is a gambler based on his belief on his good luck, and person no 2 is Trader of risk based on his analysis and plan to project expected profit.

So no matter the timeframe is, a trader still need some skills to project the future movement. they do need some luck, but they don't depend on luck.

hope this help

Skills to pay the bills and 'Luck' doesn't exist.

Luck does exist.
If I did not have bad luck I would have no luck at all.

agreed ,,,agreed,,,

So no matter the timeframe is, a trader still need some skills to project the future movement. they do need some luck, but they don't depend on luck.
Luck does exist.(CO)

If I did not have bad luck I would have no luck at all.(m.gary)

89.9% Skill / 10.1% Luck - give a little bit more to luck

Since i am a junior member so i cannot start the thread, so i thought of posting this question here:

I am great at demo accounts, i even quadrupled it. But i suck at real accounts i keep losing money on it

whats wrong with me ?

I don't believe that trader can rely only on luck to be a good forex earner. I was not successful when I entered forex trading but now I am making some profits. This has only become possible because of skill.

to succeed in any business you need 3 things
1. skills
2.luck
3.guts
But mostly you need the GUTS!!!!!

Shipping magnate
Aristotle's Onassis

But mostly you need the GUTS!!!!!

agreed,,,,,,,,,,,,,,
if there is no courage to pull the trigger? how?

I'll put it this way: if I had to hire a trader for my fund I would've taken a skilled trader over the lucky one on any given day because in the short-term the lucky one could've (but not necessarily would've) made me more money but in the long run the skilled one would've prevailed while the one who depended on luck would've cost me way more since no one can be lucky all the time. In terms or risk management I also wouldn't have been able to evaluate the risks of handing the money managed by my fund over to the lucky trader and so I would've found myself in a position when I gambled on whether such a lucky trader would've made money or would've lost it. In case if he would've lost the money I wouldn't have been able to determine how much that would've cost my fund and how long his losing streak (his bad luck) would've (could have) lasted and so there simply would've been no way to hedge his trading properly.

In other words, I don't gamble but all I do is bet on sure things. I hate losing and I hate the uncertainty, I do count the cards every time I play. So I say skill over luck in 100 cases out of 100.

PS: I don't mind if a skilled one gets lucky at times though. I consider it to be a little bonus for his hard work and dedication.

no one can be lucky all the time.
but
no one can be unlucky all the time.

I hate losing and I hate the uncertainty, I do count the cards every time I play
but
whether in forex trading have certainty and never lose ?
I hope I have a healthy argument

Very true, you can't be lucky or unlucky all the time, so the question is if there's any imaginable way to measure one's luck and unluck and compare those numbers in terms of so to speak determining if one's more lucky than he's unlucky or he's more unlucky than he's lucky and later on turn those numbers in potential dollars earned/lost.

Obviously there's no way to measure these things and one can not predict if a trader who's counting strictly on luck will get out of his say slump any time soon. That's where even bigger uncertainty comes into play, and I don't bet on slim chances like that. It's gambling, not trading. And if you're gambling you should be very well aware that the house always wins, so in other words it's a sure loss in the long run. I mean, who wants that?

But yeah, one can simply not be unlucky all the time so once in a while a trader who's depending on luck will eventually be profitable, maybe even have profitable weeks or months, but it woun't last long and sooner or later he'll blow the account.


There's no such a thing as permanent certainty at the market (or anywhere in the whole world) because you never know if for example mother-nature has a surprise for you, so in terms of predicting the future not a single person can be right all the time and even if he's good at what he's doing eventually he'll lose at times. But if one can develop a reliant strategy that will include all those little (and not so much) components and can stick to his discipline he'll be victorious in 50%+ of the cases, and eventually that will mean making more money than losing. That's a winner, he wins more than he loses.

Ofc, I'm not talking about those traders that are profitable in 60-70-80% cases and then they just blow all that money away in couple of bad deals. That's an indication of bad risk management and improper discipline, but all in all if they discover their way to develop a discipline and plan their risks better they'll become profitable.

Say, hypothetically I close out a total of 10 deals a day. 7 of them are profitable and each one of them brings me an average of 100 points. The rest 3 deals are losing me money and each one of those three costs me an average of 150 points. (7*100)-(3*150)=250 (points/day). I can live with those chanses and still consider myself a winner.

But all in all, I find it hard to believe that there's a single person out there trading who haven't lost at least once because as the saying goes 'no one's perfect'. So yes, I do agree with you that there's no way FX market (just like any other market) can be imaginable without never losing. It's just a matter of how much (and by how much) do you lose and how much (and by how much) do you win.

I'd rather be lucky than skilled. the difference is being in the former it means riches and the latter sweat and leanness.