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The Paved Road to Success for the Average Joe (or not)

  • #1
  • First Post: Edited Feb 13, 2017 12:32am Feb 12, 2017 10:01pm | Edited Feb 13, 2017 12:32am
The aim of this post is to warn would be traders of the harsh & long road to success. here goes..

Suppose the odds of your strategy r slightly worse than a 50-50 coin flip at 40(win)-60(loss). but u improve your edge by taking $2 profits for each $1 you risk

your e(v)= ($1x 40%x +2R) - ($1x 60%x -1R)= +$0.2
(aka u can expect to make $0.2 on average for each $1 u risk)

suppose your target income & bankroll r as follows
tgt mthly income = $5k
acc bal = $10k
risk/trade = 2%x 10k = $200

crunching some numbers. this means you have to take 125 trades to churn a $5k profit with your strategy's +0.2R e(v)
avg trade e(v)= $200x (0.2)= $40
est no. of trades to hit tgt mthly income= $5k / $40 = 125 trades

too tough? break it down into realistic 1st steps:

milestone 1) make 4 +2R trades per mth= $160
milestone 2) double acc bal deposit to 20k
& make 4 +2R trades per mth= $320
milestone 3) compound.

it is tempting to use leverage, but if you dont know what you r doing. a word of warning- it is not for the average joe. mental preservation is more important than capital preservation.

This tough road is also why supposedly successful traders r selling systems. It is so much easier to collect $ pple r willing to throw away for hope. It is also why reasonably successful traders mentor for a fee- to diversify their income & reduce the burden of trading for a living on their mental state of mind.

Trading for a living is tough. give up now & save your precious time & money. do something else you have a passion for. OR slog at it for an average of 7 years that it takes to make the average successful trader.


edit- missing multiplication signs
  • #2
  • Feb 16, 2017 3:48am Feb 16, 2017 3:48am
Yes if you don't know what you are doing you are at most risk of losing money. 90% of people on FF don't know what they are doing. That's why they come to FF to look for answers. Even if you give them the answers they don't know what to do with it. Even if you give them trades that make hundreds or thousands of pips they don't trade it. It's that bad on FF. They have a losing mindset. They are blind to winning trades.
You came here for the truth and let me unveil it for you
  • #3
  • Feb 22, 2017 10:56am Feb 22, 2017 10:56am
the reality of trading is as such. the good news is that there is a way to accelerate & perhaps half this timeframe.. that is to learn from successful traders. I'm talking market wizards, well known traders who published books. search for podcasts on interviews with such traders. there is wisdom condensed in those short interviews. what is gold is not finding out what setups they take, but their various unique thought process.

the one similarity I see is. most who were without mentors experienced this long lonely journey. all of them concluded that managing risk is how you survive in this business. all do not trade their pnl. they all understood e(v) (see post 1 above). all of them were driven however long it took them to succeed. if you were to discourage them in their initial struggling years.. saying.. hey maybe trading is not for you.. at least you tried. they will see this as a challenge to move forward.

there is no shame in giving up trading. at least you tried. there may yet be something else you have the passion for & can succeed in.

if you decide to move forward, know that you may not like what you find. its like staring in the mirror & seeing an ugly beast. trading is mostly a struggle with understanding yourself & overcoming your own demons.
  • #4
  • Feb 22, 2017 5:03pm Feb 22, 2017 5:03pm
Quoting econbizer
the reality of trading is as such. the good news is that there is a way to accelerate & perhaps half this timeframe.. that is to learn from successful traders. I'm talking market wizards, well known traders who published books. search for podcasts on interviews with such traders. there is wisdom condensed in those short interviews. what is gold is not finding out what setups they take, but their various unique thought process. the one similarity I see is. most who were without mentors experienced this long lonely journey. all of them concluded that...
You make some good points. However you have missed the point that it's all well and good to read all sorts of books, videos about trading and to learn from successful traders, ultimately, you must come up with your own strategies that you have created or evolved from your experience, your trades and what you have learnt from others.

I agree trading is not for everyone. Trading might not be your calling. Keep searching.
You came here for the truth and let me unveil it for you
  • #5
  • Feb 22, 2017 9:19pm Feb 22, 2017 9:19pm
Quoting RondaRousey
{quote} You make some good points. However .... .... ultimately, you must come up with your own strategies that you have created or evolved from your experience, your trades and what you have learnt from others. I agree trading is not for everyone. Trading might not be your calling. Keep searching.
Excellent point! every trader who has struggled long enough will come to the point where he/she must discover a style that is balanced with his/her personality.

If you are always looking to do something, long term swing trading stocks for eg may not be for you. intraday may be more suitable. on the flip side, if you find intraday trading too much for your heart, swing trading may be more suitable for you.

Everyone's experience is different. This is where you must discover your own style.
  • #6
  • Feb 23, 2017 1:29am Feb 23, 2017 1:29am
There is no road.
and if there were one it would not be paved.

You arrived at a fork on the road.
one way will lead to your success and fortune.
the other way will lead to your perdition.
There are two witches standing there.
You know that one of them always tells the truth, and the other one always lies.
You can only ask 1 question to both women.
Only 1 question with a response from both old hags will take you on the right path.

What is the question ?
  • #7
  • Mar 3, 2017 12:16pm Mar 3, 2017 12:16pm
"OR slog at it for an average of 7 years that it takes to make the average successful trader."

Hi econbizer,
Out of curiosity, how did You come at this number (7 Years?)
From my personal experience, what makes this job really hard is the almost absence of reliable education.
Better said, Surely there are valuable insight to absorb, here in FF as in other places (I have no problems at all admitting I subscrided myself for a paid tuition), but YOU have to find them in an Ocean of useless material.
And, If trading is not for everyone, of course it is SUBJECTIVE, meaning that given a successful methodology results WILL wary.
Just as it is true that many will simply choose not to trade it, if it is not in line with their vision of the market and of this business.
Thank you for the valuable informations.
maxx
If you quit, it is NEVER going to happen...
  • #8
  • Mar 5, 2017 8:31pm Mar 5, 2017 8:31pm
Quoting maxx7
"OR slog at it for an average of 7 years that it takes to make the average successful trader." Hi econbizer, Out of curiosity.... ... maxx
I gathered this from all the podcast interviews, articles I listened/read, with successful traders. Some took 10, some 5. Rarely less than that. This is the approx duration for the average joe who had a smooth sailing life, with no mentor. There are rare traders who succeed in a very short amount of time, maybe due to a unique way of looking at things.. a transferable skillset to trading. For example, they had a tough background, are professional texas holdem players, professional athletes.

You have already uncovered part of why it takes so damn long. It is tough to differentiate what education info is reliable & what is not. This is also part of the self-learning process where we learn to filter BS from gold. Once you get enough of this, you can smell BS from a mile away. There are reliable education out there.. many pro traders r mentoring / selling services for a fee. This is an alarming fact of how tough trading for a living is. Why is a pro-trader not scaling up.. & instead selling their knowledge?? bcos trading is tough.

Another issue is that even if you uncover what is reliable, you are faced with the next important step of deciding if this trading style is suited for your character. This may take even longer. This is why precisely why most newbies pour over ff searching for the 'holy grail', hopping from system to system, getting stuck in the endless cycle of failure. I was this newbie. I am just less of a greenhorn now.

After that, it is simply making time to do your homework & trade.
  • #9
  • Mar 6, 2017 3:13am Mar 6, 2017 3:13am
I was that newbie also, and a work in progress right now.
Worse yet, I used to give value to "education" that was somehow in line with my perception of market mechanics at the time.
Naturally with the naive knowledge I had that was a sure road to failure...and i have failed myself more than once.
The big base of it all is your "WHY?".....but this is maybe material for another thread.
(If you do not have a big enough WHY, then is better to give your money to a Foundation you trust).
So in the end is just searching and developing....and for definition it can never end. There is no limit for BETTER.
But now, given you have already the passion and are willing to put in the effort : Where the hell are you going to find all the time it needs to see results in a reasonable amount of time?
I mean, since we are here to build ourself into good, consistently profitable, full time traders, it means that we are not there yet.
So we must provide for oursefves (AND FAMILIES) in some other way...dayjob for the most of us.
This lead the Average Joe (wannabe)trader to maybe 2-3hrs a day at best, giving up having a life or giving up on sleep.
This is where I stop and cannot find solutions....and consequently wake up even at 4:30am to study.
I am sure I am missing something, or couldn't be any successful full time trader out there.

maxx
If you quit, it is NEVER going to happen...
  • #10
  • Mar 6, 2017 7:58am Mar 6, 2017 7:58am
Quoting maxx7
I was that .... ....there. maxx
I feel you. I am also in a similar circumstance. Family comes first. That's why we have to sacrifice something else like sleep. You are on your way to succeed. seeing you wake up at 4.30am, you are hardcore. It is great to see such passion!!

Something that helped me was podcasts (such as ch@t with tr@ders). It is a great time saver to learn & listen on the go. I also use economist audio for weekly highlights. Looking for that next opportunity on bits of news like exploding samsungs to give me a reason to long apple.

There are many times when I feel tired & the have the fleeting thought of giving up. Then I asked myself what have I lived for, if I were to die this instance. And I push on. If it is so easy to lose money in the market, it must be easy to win it to, once I get my sh%t together.
  • #11
  • Mar 6, 2017 12:18pm Mar 6, 2017 12:18pm
Quoting econbizer
{quote} I feel you. I am also in a similar circumstance. Family comes first. That's why we have to sacrifice something else like sleep. You are on your way to succeed. seeing you wake up at 4.30am, you are hardcore. It is great to see such passion!! Something that helped me was podcasts (such as ch@t with tr@ders). It is a great time saver to learn & listen on the go. I also use economist audio for weekly highlights. Looking for that next opportunity on bits of news like exploding samsungs to give me a reason to long apple. There are many times...
You fu@#%ing rock man!
I think exactly the same.
And, if this can be of any help, I found it extremely useful feeding my mind with something that pulls me to my peak state.
For instance, when I daytrade I have my headphones on with particular sorts of music + binaural beats.
Or, better yet, I listen to my favorite motivationals. Call it silly but to me is fast and straight to the point.
It helps me a lot to cleanse my performance fright and stay on the process instead.
For the sake of optimizing : Would You please share how do you run your chart analysis?
I find regularly myself starting whith clarity and purpose and then distracted by a number of "possibilities" that are not in the "plan".....
I plan something like "10min per pair/instrument" and then stay on the same chart forever, analyzing all the details my eyes can possibly catch...

Diagnosys? Therapy?

maxx
If you quit, it is NEVER going to happen...
  • #12
  • Mar 6, 2017 6:31pm Mar 6, 2017 6:31pm
I'm new and just looking for a mentor or some sort of direction. It sounds like you are knowledgeable. Any chance you could help a girl out?

Quoting RondaRousey
Yes if you don't know what you are doing you are at most risk of losing money. 90% of people on FF don't know what they are doing. That's why they come to FF to look for answers. Even if you give them the answers they don't know what to do with it. Even if you give them trades that make hundreds or thousands of pips they don't trade it. It's that bad on FF. They have a losing mindset. They are blind to winning trades.
  • #13
  • Mar 6, 2017 10:21pm Mar 6, 2017 10:21pm
Quoting Jmcd0301
I'm new and just looking for a mentor or some sort of direction. It sounds like you are knowledgeable. Any chance you could help a girl out? {quote}
you are more than welcome Jmcd0301.
Just ask.
Make a brief description of Your situation and we will be happy to help at our best.

maxx
If you quit, it is NEVER going to happen...
  • #14
  • Mar 7, 2017 2:58am Mar 7, 2017 2:58am
I think maybe in the world of trading there is too much attention to "education". Ok, you sure have to know the basics, but being a good economist doesn't make you a good trader. Trading is a science of it's own. May be the only one where "education" and experience is not in your favor.
To be succesful, you have to have well defined:
- entry conditions (simple are the best IMO)
- exit conditions (much more important than entry conditions)
- money management
- discipline
In the end you have to put all this together. Nothing more, no more knowledge needed. But putting it all together is a bitch.
  • #15
  • Mar 7, 2017 3:10am Mar 7, 2017 3:10am
I am with you there maxx7 just don’t give up. I’ve been in this for 2 years now reading and blowing demo accounts and live account too. Its just some recent weeks I started to get the grip of it not blowing my demos anymore
  • #16
  • Mar 7, 2017 6:02am Mar 7, 2017 6:02am
Quoting PiranoTrader
I think maybe in the world of trading there is too much attention to "education". Ok, you sure have to know the basics, but being a good economist doesn't make you a good trader. Trading is a science of it's own. May be the only one where "education" and experience is not in your favor. To be succesful, you have to have well defined: - entry conditions (simple are the best IMO) - exit conditions (much more important than entry conditions) - money management - discipline In the end you have to put all this together. Nothing more, no more knowledge...
Hi PiranoTrader.
well, when I said "education" I was not at all referring to that kind academic school clesses on Economics, and I am sure You were using the example to expalin your point.
The education i mean can only be provided by experienced traders (not chartist or analysts) that have themself provided all the time and passion (and Money) for the accomplishment of their goal. If you do not have lived that everyday struggle to arrive you have nothing to teach. Is that simple.
(and that is also why I do not have problems with pay to learn, if it is Worth and I can afford it : A person can choose to share his hard earned knowledge for free, but it has to be his choice).
Now, Your list make sense, but to mesh it all together can need a lifetime. This is :
1- Where good educatione comes in (if it is of Quality, It can save You a lot of time-money-headhaches-fights with families...you name it)
2- Where it becomes critical to divide the Gold from the Bulls$@it! (that really takes time if you have to do it by yourself)

Hope this make sense
If you quit, it is NEVER going to happen...
  • #17
  • Mar 8, 2017 7:55am Mar 8, 2017 7:55am
Quoting maxx7
{quote} you are more than welcome Jmcd0301. Just ask. Make a brief description of Your situation and we will be happy to help at our best. maxx
Hello

Thank you max. I'm new and I'm just wondering how you choose a pair to trade and how you read candlesticks to trade. How/where did you go to learn how to trade?
  • #18
  • Mar 8, 2017 12:15pm Mar 8, 2017 12:15pm
Hi Jmcd0301, just a couple questions to better help you :
How much time a day do you have to study and develop?
Do you have a job at the moment?
Do you have a family to provide for?
How old are you?
What is you personal plan for the coming 3 years (I mean professional plan, job, earning money you got the point?
Just a quick inside look, do not feel pressed to a long detailed answer (but of course write it if you feel like doing so

maxx
If you quit, it is NEVER going to happen...
  • #19
  • Mar 8, 2017 12:30pm Mar 8, 2017 12:30pm
[quote=maxx7;9642072]Hi Jmcd0301, just a couple questions to better help you : How much time a day do you have to study and develop? Do you have a job at the moment? Do you have a family to provide for? How old are you? What is you personal plan for the coming 3 years (I mean professional plan, job, earning money you got the point? Just a quick inside look, do not feel pressed to a long detailed answer (but of course write it if you feel like doing so

hi!

i work full time at a university. I'm 31 and have a few commitments a week. One thing im great at is studying, but I want to go straight to the source. I don't want to waste time reading meaningless and contradictory info. I was told to find a successful trader and ask them. I found one successful person, but I questioned his motives. I just want someone to show me the ropes or show me where to go to learn.
  • #20
  • Edited 2:45am Mar 9, 2017 2:30am | Edited 2:45am
" I found one successful person"

Whooahhh!!! really???!??!
Well than you had a good gun in your hand!
Forget about motives and take the mechanics instead. Your Motives you will build yourself later (It does not mean that the present ones you have are not good...problem is that you will see yourself that this business is no romance at all)
Straight to the source : This is the hard point. I am good at studying also but...studying what???!?? There is so much crap out there (and you can of course pay $$$ for that) that the hardest for a beginner is to separate the good from the completely useless.
I would suggest to choose a thread between the following ones (not really for beginners) and shoot as much questions as you can, after your diligent personal study and research.
https://www.forexfactory.com/showthread.php?t=2331
https://www.forexfactory.com/showthread.php?t=230888

Keep in mind : you are forcing yourself to stretch out!
Candlestick reading . this is just a part of the story. How big or little it is depends on the style of trading you will choose.
Candlestick reading is nothing withoud context for instance. What does "context " mean? in a nutshell it means the behavior of the prices in that market (=in the chart you are watching at) that brought to that candlestick formation.
Seems easy? not at all! Can You make it? DEFINITELY!
If there is anybody in this world that made it, YOU ALSO CAN!
You just have to find a way that works STATISTICALLY (trading is a numbers/probabilities game, nothing more nothing less)
....And make sure it applies to yourself better than your underwear.....
This last one was to relieve a bit of that "Last Guru" flavour from thos post....I was getting maybe too serious...
But you see yourself, If you find someone who is already successfull in this hard business, who can prove his success with numbers (account growth, not words), I strongly invite you to model him/her yourself as close as you can.
1- This will save You a terrific amount of time, since You will find a lot of good, WORKING answers to you questions...and You will have plenty !!
2- You will discover many interesting aspects of yourself you have no idea at the moment.....some you will like, some not.
3- The concepts you will absorbe will possibly come from real trading experience, THE ONLY VALUABLE, not books from 1974 or so...

Sorry, I have rumbled enough for today....but I was there myself (somehow I still am...), and I would have "appreciated" (I would have killed for) somebody talking to me like this or better.
Have a wonderful day
maxx
If you quit, it is NEVER going to happen...
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