I have been considering FOREX trading for a while now and after a few different demo accounts and working out my strategy I opened up a “serious” demo account a few days ago and i want to know what you think about my results.
I keep reading that only a small percentage of traders are successful and believe me, I’ve paid for my trading education over the years through losses in the thousands when I was undisciplined and inexperienced. I would be part of that statistic if i gave up after blowing up my first few accounts when playing in the stock market, and i want to give Forex a try since i’ve always been passionate aobut the markets and felt i had the mindset for it.
My demo account was for an initial 5k deposit (for my real money account i would start with $2500 and am trading 1 lot where each up/down tick is equal to 1$. Are these types of results expected? Is there any reason i should be cautious of expecting results like this long term? Appreciate any input you can give me. I can go into my strategy a little bit if asked…
I cannot post a link due to the 5 post limit so you can paste this into your browser to see my trading history over the last few days.
Good work. Yes, these result are possible and expected. Of course you do realize the trades you posted started 29 July and ended 31 July. That is 2-3 trading days. your account increased $693 with a starting capital of $5000. That is close to 14% in two days. If you can maintain this result on demo for at least one month before you open a real account then you will get a more realistic idea of what might happen. If you can maintain this performance that would be great. Once you open a real account, time will tell if this is consistent. The norm is usually to trade with only 1-2% of your capital per trade. You are currently trading with 1 lot size per trade. That is 20% of capital per trade. For sustainability if we apply 2% of capital per trade it means your performance would be $69.3 instead of $693. What is the difference? with a smaller lot size you have a higher survival rate in the long run.
The OP’s posted [I]demo trades[/I] are, indeed, trades involving full standard lots, with pips = $10
(for XXX/USD pairs).
But, he says that, in his [I]live account,[/I] he will be trading with [B]pips = $1[/B] — which means [B]mini-lots,[/B] not standard lots. If this is the case, then he will not be over-leveraged, and his risk percentage will be in the acceptable range of [B]1½%-2% of capital[/B] for most trades having a 50-pip (or tighter) SL.
As Clint mentioned, as long as your trade is in that range of 1-2% per capital, you will not have to worry about suffering huge losses. i did not check what pip values your lots are, but i agree with Clint. You are doing the right thing in that case.
Clint said: [B]“in his live account, he will be trading with pips = $1 — which means mini-lots”[/B]