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Real Reasons why Retail Traders lose money

  • #41
  • Jun 5, 2014 6:21pm Jun 5, 2014 6:21pm
Quoting yazzie
{quote} Fractalist, this troll has nothing else to add. I debated with him for a bit as well and found it useless. I'm surprised he hasn't asked you to take up his "Challange"! such a Troll
Too bad that some people just like to argue for the hell of it.
  • #42
  • Jun 6, 2014 1:55am Jun 6, 2014 1:55am
Quoting trader121
1. Retail Traders do not have enough Information.
2. Retail Traders are a victim of the so called "Gamblers Ruin"
3. The spread The Spread is the trader's biggest enemy for mathematical reasons.
4. The higher the Profit, the higher the risks. It is NOT possible to earn a high profit with a low risk.
5. Unrealistic expectaitions Professional Traders have a profit target of 10-20% a year.
1) Total BS, every information that you need to be profitable is out there, probably here in the forum too, so keep seaching.Of course the big boys know more, but you dont need to know every aspect of the market to be profitable.
2) No, gamblers are victims of gamblers ruin, any responsible trader would not use gambling methods
3) Total BS, the spread is a disadvantage yes, but your edge can be by many orders of magnitude higher than your disadvantage from spreads
4) Total BS reloaded You define the risk, you can set the SL and the LOT size, the risk is absolutely controllable.
But you cant control the reward
5) Not really, some guys made 10.000% / year, how do you explain that?
If you have a million you have some obligations and responsibilities, so its reasonable to limit yourself to 10% or so, but for a 1000$ account, why limit yourself?
"There's a sucker born every minute" - P.T. Barnum
  • #43
  • Jun 6, 2014 7:42pm Jun 6, 2014 7:42pm
FOREX TRADERS A.K.A. GAMBLERS who think they can create a system or use indicators, James16 or whatever to Predict the "FUTURE" behavior of a pair, they all pretty much fall into the Gambler's fallacy...

http://en.wikipedia.org/wiki/Gambler%27s_fallacy

Nothing else to add. For now.
The Black Swan: The Impact of the Highly Improbable
  • #44
  • Jun 6, 2014 9:42pm Jun 6, 2014 9:42pm
Quoting MapleLeaf
FOREX TRADERS A.K.A. GAMBLERS who think they can create a system or use indicators, James16 or whatever to Predict the "FUTURE" behavior of a pair, they all pretty much fall into the Gambler's fallacy... http://en.wikipedia.org/wiki/Gambler%27s_fallacy Nothing else to add. For now.
I see you spammed many threads with your gambling BS, well if you think that the "systems" are gambling methods, then tell me how do you trade the market if not with systems?
"There's a sucker born every minute" - P.T. Barnum
  • #45
  • Jun 6, 2014 9:49pm Jun 6, 2014 9:49pm
The statistic that I came across was along the lines of this:

q1: 30% of traders profitable

q2: 10% of traders profitable

q3: 3% of traders profitable

Keep in mind this only means that only three percent of traders are profitable in each of the three consecutive quarters. You could have a system where you lose in three quarters but the winning one could be bigger than all the losses combined and vice versa.
  • #46
  • Jun 7, 2014 1:33am Jun 7, 2014 1:33am
Quoting Proximus
{quote} I see you spammed many threads with your gambling BS, well if you think that the "systems" are gambling methods, then tell me how do you trade the market if not with systems?
Here is the answer to your question:

According to official Broker Stats reported to the U.S. Gov, 99.6% of people LOSE MONEY after 1 year of trading RETAIL FOREX.

I don't really need to add anything else. For now.
The Black Swan: The Impact of the Highly Improbable
  • #47
  • Jun 7, 2014 1:38am Jun 7, 2014 1:38am
Quoting EnoFX
The statistic that I came across was along the lines of this: q1: 30% of traders profitable q2: 10% of traders profitable q3: 3% of traders profitable Keep in mind this only means that only three percent of traders are profitable in each of the three consecutive quarters. You could have a system where you lose in three quarters but the winning one could be bigger than all the losses combined and vice versa.
Not exactly. According to official Broker Stats reported to the U.S. Gov, 99.6% of people LOSE MONEY after 1 year of trading RETAIL FOREX.

They took Three PLUS consecutive quarters in a row, as a whole... Not separated.

Sure, you can be profitable month 1... Month 2... Even during one or two quarters.

But when you take the whole period of 1+ Year, 99.6% of traders are NOT Profitable, according to the Study made by that PhD, based on Official RETAIL BROKER Stats reported to the Us Gov.

Nothing else to add. For now.
The Black Swan: The Impact of the Highly Improbable
  • #48
  • Jun 7, 2014 3:16am Jun 7, 2014 3:16am
Quoting MapleLeaf
{quote} Here is the answer to your question: According to official Broker Stats reported to the U.S. Gov, 99.6% of people LOSE MONEY after 1 year of trading RETAIL FOREX. I don't really need to add anything else. For now.
I`m aware of this, thou i though its more like 95%, but doesnt matter.

Whats your point ? That the systemical approach to trading is invalid ? Because then i have to enlighten you because its not the case.

Yo preach so much against systems and gambling approaches to trading, but there are so many profitable systems, even with indicators ,so i dont see where is the problem.

The fact that so many lose, i think its because of other things.

I saw many ex pit traders, from CME who used fkin moving averages for 20 years, and were full time traders. So i really dont see what is the problem with systems...
"There's a sucker born every minute" - P.T. Barnum
  • #49
  • Jun 7, 2014 8:34pm Jun 7, 2014 8:34pm
Quoting MapleLeaf
{quote} Here is the answer to your question: According to official Broker Stats reported to the U.S. Gov, 99.6% of people LOSE MONEY after 1 year of trading RETAIL FOREX. I don't really need to add anything else. For now.
Why are you lying?

I asked you before to give us your source for this data. You say it is 'official'. OK, WHERE IS IT? Link please. That would prove your point in 1 second.
But you don't do this. You don't give sources. You aren't having a conversation - you are spamming this thread.

Since you are here, that means you trade FX, right? If you don't trade FX, why are you here talking nonsense? If you do trade FX, why and how do you trade?

Your entire position is build on a lie. Put up or shut up. If you don't put up, I recommend that you be prevented from posting further by admin. FX is hard enough without having to deal with trolls spewing their personal problems onto us.
  • #50
  • Jun 7, 2014 9:12pm Jun 7, 2014 9:12pm
I completely disagree with each of your points. I assume you woke up one day and decided to be a Forex trader and have not prepared yourself to succeed in any form or fashion. Correct? So, now you want to throw a pity party and proclaim Forex is evil and no one can do it. Surprise!! It is just you.

What was your last job? Was there any skill required? Did you have to do training? Did you get evaluated? Were you better at your job on Day 100 than on Day 1?

Enough said. If you suck at trading, it is your own fault, not the world's or the broker's or the market maker's. It is your responsibility to trade and win. If you cannot do that, then learn how or quit trying.

There is no crying in Forex
You cannot be extraordinary by being normal
  • #51
  • Jun 7, 2014 9:20pm Jun 7, 2014 9:20pm
I am not sure what kind of crack mapleleaf is smoking, but if you live in the United States it is a law, part of the Dodd-Franks Wall Street Reform and Consumer Protection Act, for brokerages to inform their client traders on the overall winning and losing accounts. At my brokerage, the average winning traders per quarter is 27% which means 73% of traders hold losing accounts per quarter. Over 100,000 traders use my broker. If you trade with mapleleaf's brokerage, you might want to consider a new broker because it sounds like something is drastically wrong over there.
You cannot be extraordinary by being normal
  • #52
  • Jun 7, 2014 10:02pm Jun 7, 2014 10:02pm
http://www.marketwatch.com/story/why...ney-2012-08-13
Gregory D. Alexandr
  • #53
  • Jun 7, 2014 10:11pm Jun 7, 2014 10:11pm
Quoting dkrock
I am not sure what kind of crack mapleleaf is smoking, but if you live in the United States it is a law, part of the Dodd-Franks Wall Street Reform and Consumer Protection Act, for brokerages to inform their client traders on the overall winning and losing accounts. At my brokerage, the average winning traders per quarter is 27% which means 73% of traders hold losing accounts per quarter. Over 100,000 traders use my broker. If you trade with mapleleaf's brokerage, you might want to consider a new broker because it sounds like something is drastically...
This would corroborate the statistic that I quoted.
  • #54
  • Jun 8, 2014 2:46am Jun 8, 2014 2:46am
Quoting dkrock
I am not sure what kind of crack mapleleaf is smoking, but if you live in the United States it is a law, part of the Dodd-Franks Wall Street Reform and Consumer Protection Act, for brokerages to inform their client traders on the overall winning and losing accounts. At my brokerage, the average winning traders per quarter is 27% which means 73% of traders hold losing accounts per quarter. Over 100,000 traders use my broker. If you trade with mapleleaf's brokerage, you might want to consider a new broker because it sounds like something is drastically...

.. ok so what if on a good quarter 73% of traders hold losing accounts - I do think 95 % is not realistic but that is not relevant.
Even at 73% it clearly shows that over time trading the forex is a losing proposition.
Of course there will be "extremes" (extreme success / extreme failure .. and everything in between) but on average traders lose quarter after quarter....

Isn't that obvious?
  • #55
  • Jun 8, 2014 6:07am Jun 8, 2014 6:07am
Will it rather be right to say "Real Reasons why Newbie Retail Traders loose money" ?

Because i'm a newbie and after researching the strategies and details of some of the experienced traders just on FF, they are really making it whilst those i see complaining about hitting the bottom seem to be newbies.

Your thoughts?
  • #56
  • Jun 8, 2014 6:18am Jun 8, 2014 6:18am
Quoting FXMasterSK
A major reason why retail traders lose is because they don't understand why price is doing what it does and how it interacts with liquidity. This is much bigger than indicators, fib retraces, EA's, etc..
Can you create a new post to elaborate you your points pls ?
  • #57
  • Jun 8, 2014 9:17am Jun 8, 2014 9:17am
Quoting Mingary
{quote} .. ok so what if on a good quarter 73% of traders hold losing accounts - I do think 95 % is not realistic but that is not relevant. Even at 73% it clearly shows that over time trading the forex is a losing proposition. Of course there will be "extremes" (extreme success / extreme failure .. and everything in between) but on average traders lose quarter after quarter.... Isn't that obvious?
What is obvious to me is that average people suck at everything. Solution? Don't be average.
I completely agree that most people lose. They lose because they believe what they hear without testing it for themselves. Those are the people who deserve to lose, right?

I don't have a problem with people losing in forex. I don't have a problem when I lose. I am totally for helping out the downtrodden in the regular world. But forex is a voluntary arena of total competition and everybody who steps in the door must be ready for battle. If people are losing, THAT'S THE IDEA! I want you to lose so I can win.

But for Maplesyrup to come in here and start spewing fake statistics about the hopelessness of it all is just pathetic.
"Government reports indicate that 93.512% of all people who attempt to catch a fish for the first time fail and end up looking stupid..."
  • #58
  • Jun 8, 2014 9:33am Jun 8, 2014 9:33am
Quoting Fractalist
.... But for Maplesyrup to come in here and start spewing fake statistics about the hopelessness of it all is just pathetic....


It's not fake. I don't care if it's 73 % or 95% losers, the exact % does not matter, Forex is a loser's game for the majority.
  • #59
  • Jun 8, 2014 2:56pm Jun 8, 2014 2:56pm
That's true Mingary, however I'd add that every kind of entrepreneurial activity is a loser's game for the majority. That's why so many people are sentenced to a life in a cubicle doing something they absolutely despise.
  • #60
  • Edited 9:44pm Jun 8, 2014 7:14pm | Edited 9:44pm
There are thousands of retail traders around the world that make enough money trading to trade professionally. On the other hand there are also investment bank traders that lose billions and bust their company or department out. These cases are fewer than retail traders that bust out, but they are historically proven.

There are a lot of false negative assumptions with this thread.

Your distinction is "retail traders" vs. "professional traders".

There are tons of retail traders that are professional traders.

I think what you want to say is "retail traders" vs. "institutional traders".

The title of of thread is misleading. It should be "Why retail traders tend to lose money compared to institutional traders".

The most obvious reason for this is that retail traders especially those who see fx like a global casino, tend to over-leverage their positions with inadequate capital. Institutional traders tend to have much deeper pockets and usually can sustain wide DD periods and can also put on more positions during this time. Even so, institutional traders lose money too. But it's a matter of perspective. If an institutional trader loses 10%, they will probably lose their job. If a retail trader loses 10% they will think "it's only 10%" and pat themselves on the back.

The reality is even a a few institutional traders go massively belly up to the pitch of minus hundreds of millions or over a bil. Whereas, most retail traders go belly up with minus 500 or minus 5000, or if they are stupid and persistent enough they can churn their own accounts to minus 50,000. Either way that's pocket change to an institution.

As for the spread it's a part of doing business. Even institutional traders pay a spread, if they're trading at market, it's usually less. However, most institutional traders place orders at a FOK price. That's "fill or kill" in case you thought FOK meant something else. The spread is only a demise if one overtrades and the costs of the spreads on the overtraded positions amount to any profits on correctly traded positions.

It's pretty obvious by your creation of this thread that you are saying that you are a non professional retail trader and that you're just making excuses as to why you lose money. Professional traders lose money too. They just don't sit and cry and blame the system. They try to figure out where they went wrong and compensate for it next time around.

Lastly, it can be said that most retail traders are novice traders. However, again, many there are many professional independent traders that are also retail traders.

Regarding the point about not having enough information...today with the advent of instant news feeds and tick by tick real time data feeds and software such as mq4/5 and others, the retail trader today has more information than ever and even more than the institutional traders had 20 years ago. The only info that a large institutional trader can have that is an edge is institutional order flow which is still usually only limited to their own institution or personal network. It's quite useful if you could get exact specifics and timing of institutional order flow, but as you may well imagine, most of that info is kept proprietary within the trading desk. If you're an institution fighting for massive money, why would you share proprietary info with others? It would be like one of the teams in a championship playoff sharing their playbook with the other teams. Ain't gonna happen.
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