Wondering if anyone can give me some real life examples.

[parkofgrey]

Okay, so I currently am working about 70 hours a week, so I haven't yet gotten the opportunity to really dive into the forex market just yet. However, upon learning about the level of leverage you can get when trading currencies, I feel I should dedicate the next ten years of my life trying to master the markets. Anyway, my question is as follows. Assume were talking about the top 5% of forex traders. If they started at their current level of expertise with $5000 in a brokerage or ecn account, leveraged 100:1 on every position, and then came out ahead of the spread by 800 pips at the end of the month. Wouldn't that account hold a minimum of 45K at the months end? I realize that most traders lose money, but it seems to me that those who are successful multiply their capital extremely fast. I was hoping to hear some real world stories from people who after becoming wise to the market have managed to amass capital like this. Other than the obvious challenge of becoming one of the top 5%, is there anything I'm discounting here?

 

[jesteruk]

those who are successful do not necessarily 'multiply' their account fast. thats a myth which leads to false expectations

 

[shadowninja]

Okay, so I currently am working about 70 hours a week,

Holy ****. I hope it's worth it!!

Leverage - it will destroy you. You've got dollar signs in your eyes which will also lead to your downfall. Leverage can be good but if you over-do it, you will end up losing everything (yes, even spread betting companies can legally force you to sell your house if you over-leverage and end up in a position that means your account is massively negative).

You have been warned.

So think about low leverage and a longterm plan.

 

[forker]

Speaking of which.. Would be interested to hear what leverage everyone is using?

 

[the hare]

Speaking of which.. Would be interested to hear what leverage everyone is using?

A maximum of 5:1 if my mojo's working or I'm going totally banzai !

 

[Splitlink]

Okay, so I currently am working about 70 hours a week, so I haven't yet gotten the opportunity to really dive into the forex market just yet. However, upon learning about the level of leverage you can get when trading currencies, I feel I should dedicate the next ten years of my life trying to master the markets. Anyway, my question is as follows. Assume were talking about the top 5% of forex traders. If they started at their current level of expertise with $5000 in a brokerage or ecn account, leveraged 100:1 on every position, and then came out ahead of the spread by 800 pips at the end of the month. Wouldn't that account hold a minimum of 45K at the months end? I realize that most traders lose money, but it seems to me that those who are successful multiply their capital extremely fast. I was hoping to hear some real world stories from people who after becoming wise to the market have managed to amass capital like this. Other than the obvious challenge of becoming one of the top 5%, is there anything I'm discounting here?

You are discounting the other 95%, most of whom are falling over themselves to tell you where you are going wrong. The top 5% aren't talking. Would you believe them if they did?

The odd thinq about questions like yours is that that. 95% of the time, the questioner will take the advice of a loser because the answer is what he wants to hear.

 

[Shakone]

Haven't you already essentially asked the same question?

How much is a trader risking out of his account? What %?

Real life example:
I have around $5000, I trade at $50 per pip, with a stop of 50 pips, aiming to get 800 pips a month. I have a system which is supposed to win 80% of the time. I lose my first two trades, and I'm carried out.

Anything is possible, but some things are much more likely than others. Concentrate on learning how to trade, and if you do obtain an edge, concnetrate on how much you shoudl risk for that edge to play out without wiping out.

 

[Bint_Crusher]

Leverage is risk in forex. Oh sure you can open a $10,000 account and place 5 lots with a 100pip stop and hope the trade goes your way but you only need one bad trade and you will get wiped out.

I have around $5000, I trade at $50 per pip, with a stop of 50 pips, aiming to get 800 pips a month. I have a system which is supposed to win 80% of the time. I lose my first two trades, and I'm carried out.

I'm curious as to what this system is, pm if if you want to share because I don't think its the real deal.

 

[ronblack]

Speaking of which.. Would be interested to hear what leverage everyone is using?

Anything above 3:1 can kill you easily.

 

[anthonyb]

I am not being funny, but most newbie should never start their trading or investing career with FOREX. This is about the only time you would find me negative. If you were learning to drive and wanted to become a master driver, would you start with a Ferrari or a Ford? I know which one I would advise new drivers to start with and the same applies to FOREX. There is such a learning curve, that you are best cutting your teeth in the stock market and then gradually progress to FOREX. In addition the sooner newbies begin with a non margin account, the better there will become, because by the time they get ready to handle leverage properly, they will be better experienced. My advice to you is to start with slow moving stocks, with absolutely no leverage no fancy compounding etc. Feel comfortable with this first, and then progress to using leverage, before thinking of applying yourself in FOREX. The main thing is to start. In addition you are thinking of directional trades, but some make good money spread trading, i.e. going long one currency and short the other, but all this you will come to understand when you are ready.

 

[nunrgguy]

You always go long one currency and short the other - you're thinking of sumthin else

 

[anthonyb]

To nunrgguy:- Say I established there was an interest rate relationship, monetary policy/inflation, economic growth divergence etc between countries, it really does not really matter, I may go long CHF/USD contract and short GBP/USD contract for example assuming I had done my homework and anticipated one contract would move more in my favour compared to how much the other moved against me, factoring cost of placing the trade. That’s what I meant by non directional spread trade, making money from the increase in the difference between the contracts. Anyway it’s irrelevant as the crux of my argument is that a newbie should stay clear of Forex.

 

[Bint_Crusher]

Forex is ok to start with, just learn how to trade it and manage the risk properly. Spread trading or Long /Short Hedging with forex as a retail trader is appendage hoover as is anyone who tries to use volume as a trade indicator. I started trading Fx, I was taught properly and know the pitfalls well enough to avoid them ar at least ensure thay don't cost me too much.
The only one who suggests spread trading is a broker because they are going to win every time.
The post above is drivel, yer may as well get up in the morning, read yesterdays FT then go and place a trade on guesswork and make sure yer stop is wide enough to accommodate yer broker.

 

[anthonyb]

Elaborate what’s drivel on the previous post. You are giving crap advice Bint_Crusher and forget the spread trading talk because that’s the least of the point I made in my previous post. Please focus on points raised, apart from spread trading, as that is neither here or there, and the original poster is not the least interested in that. Explain to him why you feel you will recommend Forex trading to a newbie, and try not to spew nonsense like managing risk we all know that. The issue is why you would recommend Forex trading for a newbie.

 

[Bint_Crusher]

To nunrgguy:- Say I established there was an interest rate relationship, monetary policy/inflation, economic growth divergence etc between countries, it really does not really matter, I may go long CHF/USD contract and short GBP/USD contract for example assuming I had done my homework and anticipated one contract would move more in my favour compared to how much the other moved against me, factoring cost of placing the trade. That’s what I meant by non directional spread trade, making money from the increase in the difference between the contracts. Anyway it’s irrelevant as the crux of my argument is that a newbie should stay clear of Forex.

Such appendage hoover, drivel call it wht you will. Fx is great to start with so long as yer know the pitfalls. Spread trading Fx is one of them. So is reading the FT and watching bloomburg hoping to catch the "edge", which is well blunted by the time it gets into the public domain.
What I advise is not to start with CFDs, Spread betting, Options or Futures. Classic stocks is a good starting point as is Forex. Hedging at the beginning is a feckin big NO.
:smart::smart::smart::smart::smart::clap::clap::clap:
I trat my broker like my BITCH. Are you a broker by chance?

 

[anthonyb]

Phews! Sensible comments are obviously beyond you. So probably best to leave it at that. The one note that probably applies here is this. Lack of intelligence is when one does not know how little there really know.

 

[Martinghoul]

Anybody with any experience would tell you that the first and the most important calculation you need to perform is not of how much you could make, but rather how much you could lose.

 

[Bint_Crusher]

Anybody with any experience would tell you that the first and the most important calculation you need to perform is not of how much you could make, but rather how much you could lose.

Marting, I think this one's a bit of a troll, It has sucked in a couple of appendage hoovers who talk about spread trading as if it is a non gormless thing to do for a beginner. Tring to leverage that amount with say $5000, what would you do as a broker? Apart from fix the price, send out a stoprunner and wipe out the account.:smart::smart::smart::smart::smart::smart::smart::smart::whistling

 

[anthonyb]

Why can't you let it be, it’s obvious previous posts were deleted for good reasons. Try and relax and spend valuable time trading or making meaningful contributions.

 

[Bint_Crusher]

Why can't you let it be, it’s obvious previous posts were deleted for good reasons. Try and relax and spend valuable time trading or making meaningful contributions.

Simple. When I touch little emotional nerves I weed out the weak and hopeless. The ones who want to learn from me and my methods are totally without emotion, like all good traders, and soldiers.
:|whistling