B
Black Swan
Gamma this is very cool if this is true!!
Pozzy
Legendary stuff mate, 100% viable and verifiable.
arabianights
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Last edited:
arabianights
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Anyway, belize my advice is that unless you're plugged into the market, you can't trade with this kind of leverage. The chances of learning like this with essentially no resources other than a chart and spread betting price quotes are 0.
If you're not already familiar with it, I suggest you look up the efficient market hypothesis and really start to digest it. You need to understand it before you understand when it won't hold.
I'd also look at the Kelly Criterion, and since iirc you have a mathematical bent I'd get behind the maths (and related topics... st. petersburg paradox, utility theory, stochastic processes blah de blah) and understand why this level of risk will almost surely blow you up without the prerequisite skill anyway
If you're not already familiar with it, I suggest you look up the efficient market hypothesis and really start to digest it. You need to understand it before you understand when it won't hold.
I'd also look at the Kelly Criterion, and since iirc you have a mathematical bent I'd get behind the maths (and related topics... st. petersburg paradox, utility theory, stochastic processes blah de blah) and understand why this level of risk will almost surely blow you up without the prerequisite skill anyway
What do you mean by you wont make a living off £605. Do you just mean you need more than that or that amount would run out before you could make anything on it. I am new to this trading stuff though have looked at charts on a demo account, so just trying to get my head around what you mean. Why have all failed starting with small amount?
arabianights
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For, and no disrespect intended, the ****ing obvious reason that if any eejit could take £500 they found lying around in a bin lorry and turn it into an income then everyone would do it.
arabianights
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Anyway the major point is the leverage is too high. That's the main reason *any* account gets wiped out.
It just applies moreso to the smaller accounts because in general the minimum trade size is so large compared to the account balance.
It just applies moreso to the smaller accounts because in general the minimum trade size is so large compared to the account balance.
arabianights
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By futher way of example... I opened an account recently with a free £100. I put on a position that, in volatility terms, would be the equivilant of approximately 15 pence a point in cable (wasn't in cable, but translating it). And that's intending to hold the position for a few months and hopefully make triple digit percentage gains (350% is my target) in a few month so as you can see pretty high bloody risk.
Get my point?
Get my point?
arabianights
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Don't forget to give it back
arabianights
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Please restate... decided I'm still too ill to make it in tomorrow, especially having seen the pitiful lack of economic releases, without ****ting all over the floor so I have plenty of time to answer questions...
counter_violent
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Newbies...Read this over and over until your eyes bleed.
I asked the question because I want to learn to be a trader not a punter. I meant if you only have a small fund to start with of say $500 couldnt you use this and build? I would only risk at most 1% until I knew what I was doing. This would also be after I had used a demo account for sometime first.
I don't intend to be in a hurry, patience is often the key in things like this. Crawl before you can walk. The above post is great advice and certainly how I intend to proceed.
I don't intend to be in a hurry, patience is often the key in things like this. Crawl before you can walk. The above post is great advice and certainly how I intend to proceed.
B
Black Swan
Ah-ha! There is a paradox; I'm very confident I could now take 500 quid and turn it into 5000..inside 2/3 months. However, I couldn't have done it when starting out. I've made this suggestion before and worth repeating and its kinda based on my experience and others', (no apologies for it sounding simplistic, ain't got the time/energy for 'war and peace')...
:First step; fund your new SB account with 200 quid with for example IG Index. Do their trade sense programme with ten pence trades for as long as it lasts, iirc it's six weeks, but perhaps your cash'll run out quicker. You will lose that money, but it is stage one of your educashun.
Step two, if you like the *game* have a good long think about where your money went, then it's time to fund the account with an amount that'll hurt (not a lot but enough to **** you off and concentrate the mind) approx. a grand should do it.
Trade this with no more than 2.5% risk per trade on 50p trades 50 pip stop loss. 2.5% is a bit high so stick to one pair only (perhaps EU) until you become proficient and have confidence in the holy trinity; your platform, your edge and yourself. Trade on 15 min TF so the 50 pip sl should give enough 'insurance' but not always. On average you should be spotting 3-4 trades per day off a 15 min TF from 8am-8pm, just figure out a way to follow price and be patient. EU threw up one great opp. yesterday when everything in the universe lined up at approx 15:45, kerpow, pull that trigger if you do the job right it'll probably be payday for the 3 OK trades that preceeded it..and by OK I mean 1 b/e, 1 win, 1 loss..and get ready to embrace that as probably a very good return measured over a 4 trades.. You could alternatively open a micro account with Alpari and continue with perhaps 20p trades ensuring your cash will go a lot further...
Stay in the game as long as possible with that grand whilst soaking up as much info. as you can from corners of the interweb such as this and books, etc..etc..
So from total beginner to fledgling (full time) trader could take £1200 over an extended 6-12 month period. However when you've lost the first 500 quid I'd suggest a 3/4 month break, perhaps chart watch for 3 months, seriously, chart watch and paper/demo trade and look at what price does, when and why...
TBH to get into this game for approx. a grand up front cost is an opportunity that doesn't exist in any other industry I'm aware off..well not legal anyhow..
er that's it..Oh and never take it (the market the industry) personally, it truly doesn't give a flying fook about you or me, it (or the SB providers) are not out to get or your money, be like Arnie in the first Terminator film, follow the protocol and instructions, try your damnedest to approach it day after day in a positive light, after all you've worked to create a positive expectency to your edge so be positive...er..that's enough from me...meanreversion
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Doesn't this go back to the idea that the best traders "don't care about money" (I'm not sure I agree with the phrasing of that, but whatever..).
If you have £500 and know what you are doing, you can turn it into £2,000 fairly quickly, cos it's, like whatever, only £500.
Now, can you turn £500k into £2mio fairly quickly? Different ball game there.
If you have £500 and know what you are doing, you can turn it into £2,000 fairly quickly, cos it's, like whatever, only £500.
Now, can you turn £500k into £2mio fairly quickly? Different ball game there.
gamma
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Yes doing the first part is quite easy as you say no big deal if you lose the 500
having said that you need to really work at it to achieve it.
I was quite impressed by the chap a few months ago who did a 3 fold increase with 3k I think.
also I think most of us serious traders are risking quite a lot of capital which we can't afford to lose to give us 5 /10 % returns a month
meanreversion
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Can you imagine trading like a dog for ten years, building up a nice little pot, and then going to Vegas and staking everything on red at the roulette table? I mean, everything. Imagine the adrenaline, it would be almost uncontrollable. And then the relief and ecstasy when red came up. Or the sheer, utter terror and despair if it was black (or 0).
Sounds like something out of "The Diceman".
Sounds like something out of "The Diceman".
CaptainAmerica
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I think you are pretty brave for giving it a go. Ultimately though I think to be a really good trader "consistancy is King" and when you are primarily leaving your trading decisions up to a Hunch you can never really become consistant.
My belief is that there are many trading systems out there which can potentially work if the trader is disciplined enough in the long run to execute it with a high degree of accuracy.
If you want to take a primarily fundamental view thats fine, but I would say even fundamentalists look for good technical entry points. I think instead of buying into a straight upward trend, perhaps wait for a retracement. Then when you get your retracement and you get a signal that the market it going up again, you can place your stop under the low of the retracement and have a set target of the previous high, so that your risking a lot less and in this example you would have got into the position at a lower price. For example in your chart wait for the market to have taken the 20 pip dip and then retarget the high or get a fib extension and target 61.8%.
Also I really wouldn't use a spread betting account if this is a punt, if its the brokerage fee that you are worried about I would use Oanda, they charge 0.9pips on the EUR/DOLLAR and have had pretty good execution in my experience.
My belief is that there are many trading systems out there which can potentially work if the trader is disciplined enough in the long run to execute it with a high degree of accuracy.
If you want to take a primarily fundamental view thats fine, but I would say even fundamentalists look for good technical entry points. I think instead of buying into a straight upward trend, perhaps wait for a retracement. Then when you get your retracement and you get a signal that the market it going up again, you can place your stop under the low of the retracement and have a set target of the previous high, so that your risking a lot less and in this example you would have got into the position at a lower price. For example in your chart wait for the market to have taken the 20 pip dip and then retarget the high or get a fib extension and target 61.8%.
Also I really wouldn't use a spread betting account if this is a punt, if its the brokerage fee that you are worried about I would use Oanda, they charge 0.9pips on the EUR/DOLLAR and have had pretty good execution in my experience.
