[QUOTE=mastergunner99;74092]
…
Lack of money management is the sole reason one blows their account.QUOTE]
Yep!! 
Have a read of this very poweful piece of literature …
Tymen, that is an interesting little article and so very true! If only new traders could read and believe in that article’s message, they could do in 5 minutes what will take them months, if not years to learn the “hard way”. But sometimes you really have to learn things that hard way, so I don’t want to push it too much!
I stand by the 1-2% risk per trade. If you want to risk 5% on a trade, how much are you looking to make in say, a month? It must be at least twice what you risk on one trade, and I assume you’ll be making a number of trades per month. So maybe you’re looking for 20-50% gains every month? Ridiculous! It can go the other way one month, and then you’ve got HUGE drawdowns, which as you know are more difficult to get out of than they were to get into. If you’re looking for 5-10% a month (which is a VERY healthy yearly return) then there’s absolutely no reason to be risking more than 1-2% per trade. Perhaps if you are only taking 1 or 2 trades a month, that would be an exception.
1-2% Ahhhhh!!
5% Yikes!! :eek: :eek:
I have had an account deposited $10 and now left 0.07 cent. I don’t know whether it was blown or not. But I do learn why I’d made a lot of losses, I don’t follow my system properly. I have another micro account, I hope I don’t repeat the same.
hey jawn,
hey everyone,
this is my first post on this forum just wanted to say hey before i just go busting out with my wild posting. Ive heard alot about babypips so i figured i would pop over.
so jawn your one month in congrats on takin the first step… im assuming your demo is still workin out well and your thinking of throwing some cash out there.
while im all about saying yeah dive in and make some cash… i want to say maybe you should hold back for a bit. yes having a live account is alot different and trading one whether you go bust or not would teach you valuable lessons…
but there are some things to think about initially, such as:
this isnt investing… this is trading
in trading you need to win with probability & statistics
trading systems give you this but if you test your strat for one month then your system is only as good as that one month of testing
while your trading system maybe be amazing 95% win rate yatta yatta that does not take away from the fact you could loose making 1 trade a day 70% of the time in one month…
but over the course of many month avrg itself out to its true probability of success…
the same is true with a bad system… low prob of success over short term may seem good but law of large numbers after a few months would turn that around and you would be shown your true rate of success.
so what am i saying…
hold off on your live account you need to check off things before you should feel ready
-have a trading system > 60% success rate with extensive testing
-well thought out entrance and exit for your trades
-well thought out money management system
- youll hear 1-2% or 5% or whatever from people but you need to assess your own risk level and carefully consider that level and how you should put that into action.
-you should trade this perfected system for so long that it should seem like a chore to trade it you should almost be mechanical yourself in how you approach, and put forth the trade from beginning to end.
-and YOU SHOULD ALWAYS TRADE YOUR SYSTEM AND STICK TO YOUR PLAN you trade the market the market does not trade you
- look for certain deadly signs of piggishness
- you chase the market moves in the demo
- you have hard time sicking to exit strategy in demo chasing profits
- you enter late when you missed the entrance due to walking away or whatever… and you chase
these will leave your account in demise
when you can look at all of those and say I do what I should do all the time whether i loose or not and i do not chase or do what i should not do all of the time
then open your account and experience emotional trading with very low amounts
build into your live trading comfort and after and extensive time increase account size and trade size and even leverage.
with the right money management and mentality you wont blow your account to hell.
remember test test test… when you think you got something good backtest… test test test… apply in live in low amount write down keep track of success rates and make sure your reward> risk
love pipynotstockings
cool guys, thanks for the info
I like the tone of that topic. I am currently to the point where the available margin in my demo account is getting close to nil. The reason why ? I am a total newcomer in Forex. So I am still learning thinfs like stop loss and eurusd is killing em right now.
And yes, if my current demo account goes down, I’ll create another one :eek:
Hello Friends,
Patience and knowledge is must for trading. To manage your investment portfolio is necessary. Build your own trading strategies and keep your self updated with market news and analysis. Go for more and more knowledge about forex and its trading.
Make you trading skills sharp and play with this market. Take help of all the trading tools etc.
Happy trading.
Interesting post. Just to be clear about what you say, what you mean is it’s much better to “play” a good number of small orders than to focus on some big deal. Like, as a rookie trader, I should use a solid amount of micro lots.
Busting your account is a myth . . . IF you prepare accordingly. I recommend 3 things: 1. Do not open undercapitalized. I opened with $3,000. I have taken some losses, but I’ve also gained them back, and am getting more savvy by the day. 2. Do NOT over-leverage. 3. Watch ICT’s videos. ALL OF THEM!!! REPEATEDLY!!! Do that, and you may never have to join the ranks of FOREX kung-fu theater.:42:
Hi everyone,
jawnlooi I’m a noob too, although I have done lots of studies, and I feel ready for the big jump.
I have to say I can see myself in what you do as I’ve also setup my mind in thinking that my test account is to be considered like my live account. Did it really work or not, I don’t know, but each decision to buy or sell a pair was carefully thought.
I think couple of reasons are missing on to why people blow up their accounts:
-
You don’t have enough knowledge in FX, so you seek information in easier things such as indicators. And you only trade based on those charts that look much more like christmas trees than trading charts. I think you should be able to spot a pattern, and then use indicators to confirm. Not making the indicators the main part of your strategy.
-
You underestimate your environment, how many screens you need, which information you think you should access quickly, can you stretch your legs, is/are your screens to bright, can you lock the door when you start trading or do you have your little baby coming up every now and then to play with daddy etc… Each distraction that will take you out of the screen can have an impact on your trading. Even feeling unconfortable on your chair will add up stress on your mind.
Those things I think are external factors which can influence your daily trading, but are we all aware about those factors ?
So when you start trading, those external understimated factors can contribute in blowing up your account 
The OP was a guest on the site, and this thread is over 4 years old now?
Why was this dragged back up? lol
Regards
Sanj
if we put it in percentage, and lets say people who succeed in forex trading are the 2-5%, now imagine how big is 95-98% of the rest who are striving to succeed, meaning to say yeah there is a big number of people who blow up their accounts when going live for the first time, I encountered blowing up an account way back thinking I was ready, LIVE was not easy,you might have the basics but I was not prepared mentally and its OK and a lesson learned and I’m glad Im still in the game, I’ve read somewhere here in the thread that you might as well start with only half of your supposed capital, and I’d say that is good. I hope I’m making sense >.< cheers
Trade with .01 lots (I believe Oanda allows with that).
Good MM
understand markets psychology
Use Leading indicators (Chart patterns, R/S), Candle Stick patterns, e.tc.
No indicators, period! most indicators are lagging. I trade with blank charts.
No emotion allow when you trade.
Have a winning trading system! Create the system that fit for your self and your style of trading!
cut your losing trades fast before it gets worst!
Set a realistic goals (7-12%) monthly is a great goal!
how many new bies try to go for 3,4,5 10%/day and fail big time? I see it many many times.
Do not listen to anyone but yourself!
Good luck and happy trading
Around 33% of traders end up being profitable. So while the odds of becoming a loser are high, they’re not impossible to beat.
edit: just realised that this thread had been necroed. :46:
I threw my first $10k live account into a margin call in 08’, very quickly. Thought I knew how to trade.
I had since wiped out a few more accounts since then.
I was a slow learner.
But not a quitter.
If i’ve learned one thing in forex, it’s patience …which equates to proper money management.
No getting rich quick in fx.
Don’t get me wrong, I’ve made $15k in matter of minutes (on one live trade), as I am a scalper, but at an insane risk (margin).
But after you lose a couple $5k trades in a row …you get over it real fast.
What i’ve learned is, is that to absolutely guarantee making a small fortune QUICKLY (in fx)…you have to start out with a large one. )))))
Fx is an open ended proposition.
If you keep yourself grounded.
life’s too short for boring cars and cheap wine.
I Thought 90% give $ to the markets LOL
I have experienced draw downs but never ever went bust. I would venture to say that 33% of traders any given month or period are profitable but after 5 years of constant profits the number will be much lower. who knows what the number is, just work hard to become one of those profitable guys. I want to become a statistic LOL
I blew the crap out of my first account. Now with the second account I am 50-50 the last year what i gain I lose. But ,I am still with the equity I put init. I will figure this out
Yes, we all do. No exceptions. And when you start to make big bucks the worst comes, you become a cowboy and start overspending and overtrading and then you realize than the market turned your balance into something close to zero.