Is Forex trading worth it? If so, why?

Is forex trading worth it?...

My answer is yes only IF and UNLESS...

IF: you are willing to keep your positions active at least 5 years. That's 5 years at the very minimum.

UNLESS: you don't know of any other investment that can average more than a 10% annual return. Notice I said average. It could take years to realize this average.


Since leverage went away several years ago here in the USA, forex is no longer something I am heavily invested in. As aforementioned, you need to be willing to lock up your money for years and the return is not what it used to be. Therefore the risk is higher, in my opinion.

I had the worst case scenario when I started trading - I was extremely profitable trading stocks in 2008. As you all know the S&P bottomed at 666 points (devil), and from that point it was up up up...and I noticed 90% of my successful trades were long positions. I didn't know what stop loss is nor I ever used it. Who cares about stop losses when success rate was 80%+. Right...
At some point in time, like every normal egoistic human being, I started thinking the good old reverse psychology - it's been a year of extreme growth, I think it's time for markets to decline. So I started taking short positions (without stop loss ofc). At one point in time I noticed, as markets grew, I was adding SHORT positions. You can guess how that ended.
Long story short, only at the beginning of 2015 (after 1-2 years of 0 trading, 0 analyzing, 0 technical analysis) I started reading stuff about psychology and I tried to analyze my mistakes - whole that time I wasn't trading and I believe that was the key point of success - If I were trading while analyzing my psychology behind my actions, that very same trading would have affected my psychology which would in turn affect my trading - and there we go - same old circle again.
After all this time I have come to some conclusions which I will try to put here black on white - those conclusions are from my perspective as I see things:

1. Reading news and watching TV "shows" about finance is a huge setback - it unfortunately stays with us and if we (by that time) didn't know what exactly we are doing (meaning if we didn't have a system by which we traded) we are toast. This forum like many others has a vast number of individuals who claim one can know what will the large financial institutions do at a given point in time/time frame. I cannot describe in words how futile that is and it only provides to that good old familiar sense of fear, which will affect our trading.
2. The point of trading in itself is not to "make" money. It is to approach given situations correctly. Correct approach, like in most aspects of life, is an emotionless approach. If we care about money a lot, trading what we cannot afford to lose (borrowing money from friends like I did, took me 2 yrs to return it and burned a lot of bridges (friendships) in the process) - it will result in almost impossible recovery and constant need to trade more after each burned account.
3. A trader, if analytical, should have a philosophic approach, not just to trading, but to life itself - meaning we should strive to understand some key words from all different perspectives: for example I think traders should ask themselves constantly "what is price" and ALL the definitions of it you can get your hands on, "what is psychology", "why do I fear", "why am I greedy atm and not taking profit at this resistance/support line" etc etc...These questions are very simple, yet we never dedicate our time into answering them at all, lest answering them with 50 different answers. A saying "if you want to find out what kind of person you are - start trading" is there for a good reason.
4. People need to understand one thing - technical indicators are very nice looking and exotic, especially for those who are well versed in math. I've noticed that the better mathematician one is, the worse they will do in markets (like myself, who also did statistics on university with flying colors). What does that tell me? It tells me several things of which the most important is that trading systems are not about math but about something else...next question I needed to ask myself is "what is that something else?". The answer is, of course, psychology.
5. There is a reason why Japanese invented candlesticks, apart from obvious improved visibility and attractiveness reasons. Candle patterns (reversals and continuations)....oh boy I could write 200 pages here about it - I have written a book about them which I'm distributing around as I see fit (almost 200 pages). It will come here as I become more active, no time atm - but it's nothing special really, all of it can be found on web, although not in one place systematically - the reason why I wrote it in the first place.
6. Profit/loss ratio - for us directional traders (as opposed to implied volatility traders) P/L ratio needs to be positive - meaning profit size has to be larger than potential loss size - the greater the number of trades which have the P/L ratio of a minimum 1.1/1, the more selfconfident a trader can be - knowing that he finally found a system AND strategy that works.
7. Lastly, new "traders" start trading what they think, instead of what they see. For example we see the price moving to a support line, were sitting at the screen watching it closely, and as soon as the price hits that support line for the first time - we enter a position. I will ask you next thing: Where is the stop loss? IT'S NOWHERE! BECAUSE YOU ENTERED BLINDLY WITHOUT CONFIRMATION on a support line and NOW you have to evaluate emotionally how much are you prepared to lose if price goes lower. Because around that support line there is nothing that can give you the correct evaluation of the stop loss because you have no pivot-line to rely on. -------- How about this: Wait, wait, and then wait some more until candle closes and represents a possible bounce from that line which is "convincing". Price, if it will bounce off that support, will go higher - what is the harm of entering a long position higher? NONE. AND the lowest price DEFINES our stop loss. Tadaaa! A correct trade.

it is not.
people, 99.99% of them (i would say with certainty that EVERYBODY in this thread, including me) have no true understanding of relativity of the things.
it is utterly important that there are no absolutes and everything is relative to something else in this known and unknown universe.
maybe risk carries utmost importance for you and you try to reduce it as much as possible, but never forget that same risk is actually bread and butter for somebody else and for that someone, the highest risk is the optimal.
Risk Management is not the name of god.

Hello, I am new at Forex market, however I am 53 years old, and I know a little bit about life. Nothing come for free, lucky is not a factor and smart work is better than hard work....ah...and elefants don´t fly!!! Lol
Said that, I guess I know what to expect from forum traders here, and one thing I already know is that I am not going to learn the magical method, or how to double my account every single month.
I have realistic expectations, and I believe (even I paid for it) I was fortunated to find someone who makes a living of Forex market (as a trader and coach too) and I got him as a personal trainer.
I operate Price Action, and I am happy I started out using this kind of technique...
Despite I have been operating a real account for just a couple of months (after 6 months on demo), I´m already introducing small changes and making my own system.
I believe any given system is a guide and you have to adapt and personalize to your personality and self experience. This is my job.
My account is above cero (so, in positive) and I am very happy for it, however I know I could have it done better if I weren´t made some mistakes, but overall I am more than happy.
My goal is to make 5-15% profit every month (consistenly), and I know it is not easy, but I think it is a realistic goal too.
What I am expecting to receive in this forum is very simple. I´d like to hear from PROFITABLE traders with MORE than 3 years experience, or PROFITABLE traders that started out with profits and have been profitable since the begining....
MY QUESTION IS: what had they changed to avoid unnecessary mistakes, and shorten the way to success a little bit.
I´ll appreciate all well intentioned advice. Thanks

I believe I have rambled a lot about what I changed about myself, most of it is described here in this thread, and not just me, one or two more ppl shared their experiences extensively. I hope you can find it helpful, but in no manner should you be impressed by it
We may all just be trolls producing vast quantities of noise and last time we saw a profit may as well be 2 years ago One thing is sure, we are closer to trolls than successful traders according to general human psychology.

Best of luck

I know a few pro traders personally. They all have one thing in common, an excellent understanding of order flow or chart reading. Regarding managing risk, of course risk should be managed, why on earth would a trader not manage risk? If your not managing risk then your being reckless.

Risk Management means different thing to different traders, and dependent on how much Capital they have as well.

Yes, Risk is relative.

What is low risk to a person might be high risk to another person, and vice versa.

Risk Management does not just mean low risk, it just mean how one manage risk appropriately to that trader.

Whether a trade transaction or a business opportunity is low risk or high risk, the person must analyse and manage that risk appropriately.

There are "NEVER"s in this sentence. Cause that's what I wrote, and that's what you read

Risk is a good thing. Without risk there is no rewqrd. You want to make .02% on your money put it in a bank.

You must accept risk as a part of trading, driving a race car, skydiving, cliff diving, etc. Risk is everywhere. The risk of loss is always there. It must be properly evaluated, accepted, and managed. Low or no risk typically means low or no reward. That is not what trading is about.

Very well said.
But it is good to have free trades.

Can you elaborate away from equilibrium?

If you have personal trainer/mentor then why do you need advice from unknown people?

Managing risk is necessarily more important relative to one's technique of entry and exit. This is because timing your exposure to market risk is only a part of a comprehensive risk management plan.

Consider the average FF dweller who spends his waking hours figuring out a good place to enter his trade intraday while having his risk concentrated only in the forex market with no diversification no attention given to portfolio heat and the risk of ruin. I must be the only person who realizes this extreme caricature.
You misunderstand the point. Managing risk doesn't equate to lowering risk. Managing risk suggests an understanding of the implications of portfolio risk exposure, diversification, heat, and its relationship to one's equity curve. The level of risk you choose to undertake is not whats being discussed.
Cool. Doesn't disprove what was said.

Forex is about aggression and dominance. If you want to succeed in Forex you have to develop a trading mindset of a winner, like a professional athlete. If you trade with any other mindset when you trade Forex you will not be able to maintain the proper energy and stay on top.

A lot of nonsense said about managing risk. once trader open position only what is left is to exit: either take profit or take loss...If trader doesn't know when to exit then shouldn't trade at all ( until learn to trade).

Please proceed with this attitude. I wish you all the best.

Making money in Forex is 100% based upon your exit. It does not matter where you enter. If you enter at a bad location but you are a seasoned trader you can get out without destroying your equity. On the other hand a less experienced trader would have to take a major hit to their account equity because of fear.

When you can handle the pressure of Forex and you trade with confidence the market makers no longer control your mind.

Entry and exit are certainly important. However, given the context of where we are posting, they are highly overrated.

A robust system could have its entry and exit rules modified by 100 pips earlier or later and this effect really wouldn't matter that much in the long run.

anyone long on eur, aud, nzd...? looks like everyone busy with money management...

not yet. right now only selling eurusd. want to see at least one 4h green candle if ever try to buy one of those currencies.
btw, you are in a wrong thread for such conversations.