Successful strategy?

[Guest johnt4917]

On average, 80% of retail FX traders lose money. Is there anyone successful here that can show me their stratagy?

[Caseynotes]

@johnt4917, you forgot to mention how much you were offering, or you might choose a pay for signal service, that would be easier, or you could check the review site mentioned earlier in the thread, they also review pay for trading systems some of which actually do get a good rating;

https://www.tradingschools.org/trading-systems/

 

[Guest johnt4917]

Thank you for your reply.

 

[Caseynotes]

11 hours ago, TrendFollower said:

I do not trade FX so I am afraid I cannot assist you. 

That's no excuse @TrendFollower, tell us which one of the reasons you list below applies to you and your 'secret' strategy?

[Caseynotes]

A quote from @TrendFollower,  "My serious trading (the part I keep to myself - secret) 😉 is Commodities and Cryptocurrencies both 'long' and 'short' using trend following principles with my own tweaks based on my own experience."

So you can't decide if you have a secret strategy or not, but what about the newbies who, as Mcg said, 'are losing money' because of your amateur advice, you don't seem to care.

As I've said in the past I've spent years developing a system, if everybody did it it would cease to work, you can't trade so you spend all your efforts trying to get others to show you how, keep wasting your time but please stop pretending. 

 

 

[JamesIG]

This has been something I've posted before, so sorry to the longer term Community members who may have already seen it, however it's something which I think is very interesting - and it directly addresses your point on 'the 80%'.

Put simply, the best method to a successful outcome is to have a trading plan where you know your win to loss ratio going into a trade, you run your wins and cut your losses. 

This obviously should be taken as a parallel piece of advise and runs with the actual trade strategy itself. 

 

The 81% number is a top level statistic which I don't really think shows the ins and outs of client trade activity. If you want to use statistics and data then you need to dig much deeper into the numbers and in my personal opinion people shouldn't take these headline numbers as facts without substantiating them first. 

I've linked to a couple of insights we do have, noticeably which show analysis of 43 million trades, to show that actually on average on a per trade basis clients are winning more than 50% of their trades. If you were to take EURUSD for example a whopping 61% of trades are actually profitable - i.e. the client is winning their trade - and on average they book 48 pips. This means that only 39% of trades which clients took on EURUSD were loss making. The issue is clients on average hold their losing trades longer - in this study for about 83 pips.  

Each person needs to make their own trade plan, but the data is pretty sturdy. Another important point on the 43 million live trades analysis is that traders who upheld a 1 for 1 risk reward trade ratio had a better than half chance of being profitable after 12 months. Specifically 53%. Those who didn't have that 1 to 1 only had a 17% chance of being profitable after 12 months. 

The data therefore suggests that account profitability is wholly down to a client sticking to a trading plan over a longer period of time. 

Daily FX Article: https://www.dailyfx.com/forex/fundamental/article/special_report/2015/06/25/what-is-the-number-one-mistake-forex-traders-make.html 

Again, in my opinion for any serious trader this podcast could very well be the most important 8 minute podcast they could listen to: Listen to How To Trade Well: Avoiding the #1 Mistake Traders Make from Trading Global Markets Decoded in Podcasts >> https://itunes.apple.com/gb/podcast/trading-global-markets-decoded/id1440995971?mt=2&i=1000423861432

[nit2wynit]

@TrendFollower @Caseynotes

You have both offered considerable and sound advice on another thread 'Is SB for fools'.  I'm knew to this whole thing, but not new to life and ourselves as people.  I had no idea there was such a bad energy between you too, but it is sad to witness on a Public Trading Forum.  Whatever has come between you I suggest you talk privately to work it out.  There are enough keyboard warriors on FB and Twitter to bring it here too.

Nothing is Fact, everything is opinion.  Ego is at play here.  We all need to keep it in check.  We all lose if we can't communicate effectively.

i wonder if we can place a bet on you both and create a chart?

Peace out people.  Keep the advice coming, but leave the negative energies in the schoolyard.

[Caseynotes]

@TrendFollower,  same stuff over and over again, veiled denouncement of specific people for not 'reveling all' and making up derogatory reasons why that may be and all because you are so desperate to find the grail. When that person defends them self you respond with more bs and finish off with 'oh let's forgive and forget', until the next time when you start it all over again. Desperate.

I know you don't get it but it does take years of accumulated learning, do you really believe that can be packaged so as a learner can just pick it up and be successful straight away, really? A lot of the learned skills are just not transferable, people have to go through the learning process themselves and in fact you are doing them a better service by pointing the way. Better that than dishing out garbage.  

 

 

[TheGuru12]

This argument is as old as time itself. There is no right answer. 

Time, Discipline and proper money management are the three big things for me. It's took me almost a decade to become profitable. I know what my turning points were and what certainly helped with me. The two biggest helps were the Naked Trader and Stockopedia. 

Worth it though. Fascinating Subject if you get into it, Not just a get rich quick scheme. Albeit a shameless plug I release some of my trading algorithms I have played about with for free so people can take them, use them, change them and do what they like with them. You'll find them all over if you go looking. I also post regularly under different names over on the Reddit investment boards. 

[Caseynotes]

@TrendFollower, you clearly did not read my last post, this is your usual form.

[Caseynotes]

@TrendFollower,  I repeat from my previous post you never read before responding to it, same stuff over and over again, you can't help yourself, I'd give it a few days before you start up on the same theme all over again for what must be the  20th time. Desperate. 

[dmedin]

I think IG are obligated to show that 76% statistic by the regulators.  As pointed out in James' post, It's quite ambiguous.  I mean, every trader will lose money at some point.  Does this mean that 24% of retail clients never lose any money, or does it mean that they are net losers over a period of 12 months?  And if so how much money are they losing?

I mean, what makes anyone think that they can make a living out of something like this?  Why would someone think that they can 'make a living' out of playing poker?  (Some do.)

These guys who claim to make huge amounts of money trading, they will charge you $200 a month just to be a member of their forum.  Make of this what you will, but I liken it to Scientology in the sense that you pay a lot of money to be in an exclusive club, but the personal benefits to you are not clear.  

Imagine if you made super-duper profits from trading every month.  What would you do - take more vacations and retreat into private and family life, or spend all your time giving speeches, seminars and posting trade tips on a forum for cash to new traders?  Be ultra cautious.

 

[Guest johnt4917]

Thank you to all of your for your comments. I guess in the end it is time and practice? It has made me wonder if anyone actually does make money, apart from theBanks?

[dmedin]

I totally recommend using the demo platform with a small amount of funds (to make it representative of what you'd commit to your live account).  I personally was too impatient and didn't demo enough before jumping in and I lost a lot, making dumb decisions.  Every day I still question if I am dumb for keeping on doing this ... quite a lifestyle!

Edited May 23, 2019 by dmedin

[Caseynotes]

As a new, learner trader one of the most important things you need to learn real quick is to be able to spot bs because there is a ton of it about, there always is when there is the perception of quick and easy money. If you can't spot it soon enough you will not only be stepping in it you will be swallowing it and in the misdirection your little account will be gone. Sometimes it's from scammers, sometimes it from fools who just want to look big, doesn't matter, if you are side tracked by it you are lost and that's another account gone.

Here you've got someone trying to convince you that you can't be a successful trader if you spend time on social media or on forums, are you sure that sounds right? Wasn't it the case a few years back when a load of bank traders were up in court for whatever, that the main evidence against them was from their social media transcripts, they were on it all day every day. Twitter instagram stocktwits, it's constant, how can that be. It can be because once you've done your couple of hours prep in the morning the rest of the day you are sat waiting for price to come to you. But of course an amateur wouldn't know that.

[dmedin]

Sure you can get better from coming on here and discussing with other traders.  You're not going to become an instantly rich successful trader by signing up to a $200 a month forum run by a superstar trader though.  Unless you are just intending to mirror someone else's trades, I guess?

[Caseynotes]

Beware of instagram, that's where the scammers currently congregate because on instagram you can delete unfavourable messages.

I know some have benefited from a hiring a mentor for a couple of months, I'm unsure about signal providers (mirror trades) other than the majority are scammers (on instagram), there must be some good ones, I do know one with a good track record but it's only one trade every couple of weeks and the stops are massive.

But it's a mine field out there, by agreeing to participate you have shown the money and there are many waiting to take it from you, your broker is the least of your worries.

[Guest PandaFace]

2 hours ago, TrendFollower said:

@dmedin,

eToro offer Mirror Trading opportunities.

God no one should do that at all... that’s such an aweful concept. Would not recommend.

[Guest PandaFace]

I read a quote a while back that said something like

”no ones story of becoming successful started with them sitting down to read a book on how to become successful”

in my opinion all these self help books and systems and starategies are more or less **** and only there to sell (or in this day and age subscribe to to get views for ad revenue etc) to those who as in a desperate quick fix bid to get rich or be better. 

I get this may be an unpopular opinion but maybe hear me out.

You can only learn by doing. 

Start small. Learn the game. 

Only use guaranteed stops when trading leverage and yes, you’ll need more to deposit in some instances but you’re trading at 20:1 ffs. Even the banks and the worlds most successful full time traders don’t usually leverage themselves up that much. 

Trading is hard enough. Trading using a complex product likespreadbettingor CFDs is another level. Learn the ins and outs because I assure you there will always be moreto know. 

You do not learn on a demo account! People think they’re using it to perfect their system but it’s absolutely USELESS. The demo accountshould be for testing functionality NOT strategy. It takes away all forms of psychological impact. 

Seriously don’t use demo to test strategy. Use fractions of a trade size but it MUST be on live. Understand you’ll maybe lose £x but keep that figure as the cost of learning. You’re using gauramteed stops too right so there’s a limited downside.

Succes only comes from failure, evaluation and reflection, and a new attempt. Why did the trade lose? Were you following the technicals and the fundamentals kicked it into touch but you moved your lines about to fit your original convictions? You need to monitor these things. 

 

[Caseynotes]

3 hours ago, TrendFollower said:

@dmedin,

eToro offer Mirror Trading opportunities.

A post from 2018, the text covers my observations while the link covers the opportunities for broker manipulation and malpractice of mirror trading.

 

[dmedin]

Well I do recommend reading 'Technical analysis of the financial markets' by John J. Murphy.  It's old (1999) and you can get a second hand copy so it's not as if he will get much money from you. 

[Caseynotes]

TA books are all good, not much changes, here's a look at a H&S failure pattern from 1936 from Technical Analysis of Stocks Trends. Edwards and Magee.

[Caseynotes]

A list of books on trading strategies with back test studies by reputable traders.

Following the Trend – Andreas Clenow Unholy Grails – Nick Radge Dual Momentum – Gary Antonacci Mean Reversion Trading Systems – Howard Bandy Short-term trading strategies that work – Larry and Cesar Building Reliable Trading Systems – Keith F

courtesy of Raynar Teo.   

[Caseynotes]

@TrendFollower, I've just spotted a mistake in your last post but don't worry, I've put my rubber boots on and gone in and fixed it for you.

You're welcome.

[Caseynotes]

Interesting video by Nick Radge which covers some of the questions raised in this thread.

Firstly it differentiates between quantitative, all the stuff you get from books and courses (which is not covered here) and instead looks at the qualitative, all the stuff that will help you to be successful but is never covered and why books and expensive courses don't really deliver. There is some psychology but it's more to do with what actually happens to a trader and an account over time as opposed to what should be happening.

Recorded at conference in 2012, 1 hour long but there are some good jokes.

  

 

[dmedin]

On 24/05/2019 at 08:35, PandaFace said:

Seriously don’t use demo to test strategy. 

 

I read something similar in a book by Anna Couling, she said that, in addition to it not being real money the demo platform was 'rigged' in such a way to make people falsely believe it's easier to make a profit than it really is.

With regards the first argument I agree it's not real money, but if the second then it's arguably fraud and a serious complaint that should be investigated.

Personally I don't see why you shouldn't test out your first trades in a demo (assuming it works the same as live).  Doesn't matter if it's not real money.  If you lose £5000 in a demo, it's better than losing £5000 of real money, isn't it?

The first ever live bet I placed netted me £100 profit (long on Apple just before the big crash in Sept 2018).  That really was a curse.

[dmedin]

Quote

Cut Losses, Let Profits Run – Why is this So Difficult to Do?

Because price goes up AND down, right?  It never just goes up and never just goes down.  You're nuts if you think there's a 50/50 chance of being right.  It's easier to lose 10 trades in a row than to win 4 out of 10 or whatever.  And just because you set a R:R ratio doesn't mean your winning trades will actually hit the reward target.  If you're candlestick charting on shorter timescales you'll be exiting them anyway when big red warning signs show up.

Don't overanalyse.  A lot of it just comes down to LUCK.

[Caseynotes]

13 hours ago, dmedin said:

I read something similar in a book by Anna Couling, she said that, in addition to it not being real money the demo platform was 'rigged' in such a way to make people falsely believe it's easier to make a profit than it really is.

This is not true, demo platforms aren't designed for clients at all, they are designed to be a test bed for trialing new products for the brokers live platform, what would be the point of doing that on a 'rigged' platform copy. Anne Couling should stick to writing books on volume indicators without adding fake sensationalism to er, help sell her books on volume indicators.

[Guest PandaFace]

15 hours ago, dmedin said:

 

I read something similar in a book by Anna Couling, she said that, in addition to it not being real money the demo platform was 'rigged' in such a way to make people falsely believe it's easier to make a profit than it really is.

Rigged? Such paranoia! Maybe with unregulated bucket shops but not the main players...

[WallStFoxy]

16 hours ago, dmedin said:

Cut Losses, Let Profits Run – Why is this So Difficult to Do?

This is a great question because the answer is about market behaviour and so few people ever talk about market behaviour. The same thing happens over and over again you have a great trade then suddenly a spike finds your stop and bounces back in a whipsaw action then runs on for the rest of the day and you miss out yet you were right about the move, it's so common to some degree it happens almost every day. so many people move the stop to protect their trade but that only stops the loss still missing the trade so next thing they remove the stop altogether and that's it, this time there is no whipsaw the market runs and runs against you 20-50-100 points or as much as you can bear until you've had enough and finally stop out, you know what happens next it turns back and runs all the way back to your entry point. The result of this makes people nervous and in the end, they don't trust the market or themselves. The truth is when they were whipsawed out there stop was in the wrong place but their position was right, when the market kept on going it was correcting it's earlier move and it's uncanny how often the point they stop out is the end of the correction and the very point they should be looking at re-entering their position. Then as ever, there is the really big move it starts at 01:00 in the morning and never looks back till 21:00 your sat waiting for that spike back from 08:00 but it never comes and you miss the big one yet again. There is only one answer that is to know your market and its behaviour patterns and to know when to take a profit and when to take a loss. Things happen at certain times of day if you are expecting these moves it helps you keep out of trouble and learn how to cut losses and let those profits run