Forex is eventually a scam, a losing gamble, not trade

I could write something, but Manxx has already said what I would have said.

Forex is not a scam, nor is it a casino. It’s a business, a tough business.

As a retail trader, this is absolutely right. No matter how much you talk with others, and with how many, when it comes to the entry and exit, you are alone. Of course, if you “trade” someone’s mechanical or automated system then there are no such decisions to make, but then that is not really trading on a personal level.

Regarding advice, there is plenty of good advice in the quality reference books regularly posted in various threads but this is mainly useful in understanding the backbone of risk control and managing funds and various trading techniques. But one is still alone when putting it all together and formulating a comprehensive trading strategy …and then [I]implementing [/I]it in the market place!

Apart from that, the industry is stuffed with junk material and “advice” from sources that are only after your business and are only concerned with their own best interests at the expense of your’s. How can one evaluate and differentiate the wheat from the chaff? In the end one is left to trial and error and the “school of hard knocks”.
I guess one of the biggest problems is the sheer unpredictability of what is going to happen next. Nothing about price movement is constantly and consistently smooth and regular or rhythmic or cyclical. It is intensely difficult to incorporate an allowance for the totally unexpected within one’s trading parameters - and, of course, it is precisely the unexpected that does the damage, both financially and psychlogically.

Yes,I agree with you entirely. That is why I have often written about the dangers of trying to trade forex for a living. The pressures are huge and the need to perform consistently will draw you into making rash and risky trades - and when they inevitably fail they only increase the pressure to perform even more to recover from them. It is almost impossible without serious study and experience and a healthy capital balance - and even then it is not a very desirable way to make a living for many reasons.

I don’t think we disagree over this much at all, actually! Of course you cannot treat trading as a hobby if you intend to make significant money. But there is a world of difference between trying to be a professional trader and trading alongside one’s main income with a view to building capital and even the occasional “treat” out it! :slight_smile:

All I have said is that if one wants to spend one’s spare time on learning and practicing trading then this time does not have to be quantified in money terms because it is not a business, it is a hobby. Kids’ parents here spend a fortune on kitting out the kids to play ice hockey and devote hours running them around from place to place, match to match, the value of that time is the way it is spent with their family. It is all about priorities and ambitions in one’s life. And what is right for one person is not necessarily right for everyone else - and vice versa. It is surely a totally personal decision how we spend our time (and money)?

Having said that, I am not advocating that trading as a hobby is should be approach in a sloppy and haphazard manner! The ultimate objective of trading is a net profit and that requires work. But that work is in the same manner as an amateur artist, author, car renovator, musician, and so on. If it is what we want to do and we have the resources to do it, then the time we devote to it is not valued in terms of money at all, it is a question of satisfaction and personal achievement.

I do know what you are getting at, though. I too have been (and still am) self-employed. In my earlier business, you never said “no” to a customer even if it meant working through the night to get it done. It was not just about money, but about customer satisfaction, reputation and repeat business. It that environment, time was certainly money. If one is to devote time and capital resources to trading part-time then it certainly has to be considered from an “opportunity cost” perspective - resources can only be used once.

Yep, I guess that just about wraps it up! :slight_smile:

Thanks all for your time and advice.
Apologies I meant I started Oct 2015 (not last Oct as I am a bit a disoriented, working pensioner).

I do feel there might be a safer way to lose small amounts (ok to win as well depending on time span).
I am, however, angry why brokers allow clients to drive their car so fast and blind folded. They have moral duty not to behave like sharks. I was allowed maximum half deals for 2 weeks or so but could have opened as many deals as I wanted anyway. I was aware of possibility of loss but not that steep.
The prediction surveys of various brokers varied and contradicted each other, reports were misleading but all were saying - for example- that Brexit effect had already been absorbed into the current market. Eventually and due to stress I just closed all deals of that black January 2016

The brokers attitude doesn’t look honest, their spread tactics(for new deals and high spikes) are dubious and their legally imposed warning is not enough to protect people from quickly losing money they earned over several years of hard work.

Hi Kadhiem,
That is a very sad situation and you have my deepest sympathy for your experiences. You are really learning the hard way!

But my overall assessment is that foreign exchange trading is not for you at all. It is very demanding at ALL levels, there is no easy or safe way to trade it.

Regarding brokers, they recognise the requirements of the regulatory authorities (and not always even that much!) as the limit of their moral duty to their clients. Your suitability is left pretty much for you to decide. They will only advise you that trading forex involves risks and that you should only risk what you can afford.

In some ways, it is correct that traders take responsibility for their own actions, but I agree that there could be more specific warnings about the possible extent of risk - but ultimately it is like smoking, how far should governments and companies go in deterring people from doing so without infringing their freedom to make their own decisions.

I would guess from your interest in trading GBP that you are based in the UK. This is a demanding currency to trade even under normal conditions, but for a novice to trade it during Brexit year and beyond is truly high risk even for professional traders and veterans in the retail trading sector - personally, I think you should not risk your retirement capital in such verntures. Sorry, but that is my view!

I hear you there.

Some are unregulated; some are inadequately regulated.

The ones most accessible and attractive-looking to neophyte traders do tend to be the worst (strictly speaking, they’re not “brokers” at all, though they’re allowed to present and promote themselves as “brokers”: they’re actually counterparty market-makers whose own business model typically depends on their clients losing money). Appreciating the differences between these operations and genuine brokers often requires some experience … in some cases expensive experience.

However, this may [I]not[/I] be what underlies your own losses at all, of course.

It’s probably not what you want to hear at all, but I’m afraid I agree with Manxx’s post, and his conclusion, just above. :8:

Thanks for your post, Keith (Manxx),

and I should add that all of my opinions are

really shaped by my recent experiences, so

they really only reflect my own weltanschaaung,

my vision of the world, from an inevitably narrow

window of what trading is: had I experienced what

others here have experienced, I may think entirely

differently. I am guilty of having made some broad

generalisations where really I should stress that these

are not applicable to all people, obviously.

In my heart of hearts I wish I had a mentor that I

could work with face to face and who could show

me how ‘proper’ trading is done… I know that it could

make all the difference, but that kind of mentorship

is precious and rare, so unfortunately I cannot have

it.

That is totally understandable and entirely natural! :slight_smile:

But, you know, it is surprisingly just a difficult on the other side of the fence! It is one thing to be responsible for one’s own trading, but entirely something else to manage others! It is a huge challenge to guide others but simultaneously granting them sufficient room to grow individually and at the same time restricting their risk of damage. A simple limit on position exposure is never sufficient.

I think you have shown very many talents in your trading journey so far and you already possess enormous experience and knowledge about trading.

I think, if anything, you may be too early in placing so much importance on results. Results wont produce the method, but the method will produce the results.

Everyone starts somewhere and most people start from small beginnings. It is only once the knowledge and experience can be combined with confidence and the beautiful expression: a “positive expectancy” that one should start to focus on the reality of the possible returns.

There are so many factors that make up one’s trading profile and they need to be logically identified and arranged and quantified. For example, trading style (fundamental v. technical or a hybrid of the two), time frame (weeks, days, hours, etc) position size, risk per trade, which markets, etc, etc.

You already possess the knowledge to create all that. Personally, all I think you need to add is a model that tells you if the rest of the trading community is currently thinking the same way. If not, bow to the greater knowledge. if so, then just “go with the flow” :slight_smile: Typically things like 200 SMA etc,etc.

Interestingly, this is precisely what I am currently doing with Turbo’s high 5. It is an attractive idea but I am not at all familiar with longer term, breakout methods and I am looking at how I can make it work for me within my own criteria. You have the talent and the intelligence - just don’t look for results before the process. Just a personal opinion, as always, friend! :slight_smile:

Nobody can call Donchian breakouts “unsound” in principle, anyway - this much is for sure. It appears that Turbo has come up with an interesting “take” on them. :cool:

I agree that there are many brokers who trick their clients but cannot agree that Forex is gambling. It is a tough business, yes, and it’s not for everyone. It takes years, lots of practice, analysis and research to eventually be able to make significant profits. But not everyone have the time and patience to do that as in the end, you really need to commit to it. Otherwise you might indeed lose too much. And I am really sorry that you had such a tough experience. Perhaps it would be better if you take a small break and give yourself some time to decide whether you really want to continue trading and if it’ll be worth it for you. And if you feel that your broker hasn’t been honest with you, withdraw your money and close the account, there is no point on losing even more.

No, all of trading strategies are not unprofitable actually; here money management is very important issue! But it’s true; there is nothing like 100% in Forex business! Even, if you get only 70% success by your strategy, till now you have a chance to become a successful Forex trader, it’s all about money management and risk management knowledge!

Well I wouldn’t say it is[I][B] ALL [/B][/I]about money and risk management. But you are right that without this then even the best of trading strategies may not actually succeed.

But, of course, all trading has to be based on a sound approach to actual position-taking that has a track record of consistently producing the risk/reward parameters on which the risk/money management criteria are based.

Without that, the best that your money management can do is ensure that your account disappears extremely gracefully in a series of well-planned, smoothly executed, and beautifully homogenous losses, 2% at a time… :slight_smile:

There’s no discrimination whatsoever between institutional & retail environments as far as those terms & labels are concerned.

Politely, to their face & in any correspondence, they are of course clients or customers, but in reality & in-house, they’re all punters whether they’re transacting via institutional brokers or retail bookies.

They all simply place bets on the movement of financial instruments but generally the only crowd that gets sniffy about these labels & what it is they’re [B]actually[/B] involved in, is the retail sector. The vast majority of professional players really could care less & quite often refer to themselves as punters/gamblers.

They’re simply industry terms that get bandied about every day of every week & which just so happen to accurately describe the endeavor that’s being undertaken.

Underfunded & ill-prepared retail punters are by no means the exclusive donors of broker profits. Professional punters swell the satchels too on a very regular basis.

A little late to the party but here is my two cents, if you are going to trade/invest in any market you must have an edge, without one you will lose all your money, a blackjack player who counts cards has an edge over the casino, a roulette player chasing patterns has no edge and will eventually lose. In markets an edge could be something as simple as buying the S&P or DOW and holding for years, while reinvesting the dividends, this strategy has a 100% success rate. For my Trading Edge in Forex I employ the following, Trade with the Trend, Match a strong to a weak currency, trade against the crowd, patients to wait for ideal setups, and final sound money management

Is Forex a scam? No it most certainly is not.
Is Forex an area littered with the corpses of the clueless? Yes, it most definitely is.

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Hey Kadhiem,

Like many have already said, an experienced trader looking at your story will feel sorry for you but won’t be surprised. It’s the same with most jobs or careers, I’m sure that what people think you do all day based on your job title is very different to what you actually do day in, day out.

If you are going to trade for the next 10 or 20 years can every day or trade be life or death? Can you be stressed or under pressure each time a trade doesn’t go your way? That would be a miserable life.

With time, learning and experience your expectations become more in line with your ‘reality’, you then decide, or it is decided for you, if trading is for you or not.

Trading for a living is very different from hobby trading. I trade full time and feel no pressure to generate a set figure each day or month, if i did i would be miserable. When a trade loses it’s because it was supposed to, i don’t feel it. When a trade wins i don’t feel that either, it was supposed to win. Of course it wasn’t always like that and it’s taken a lot to get here, but in order for it to be a viable lifestyle for me i had to learn. Yes i do get quite pissed off at something trade related a couple of times a year but that just means it’s time for a week off.

Trading is a lot of work and there is a lot of going backwards to go forwards, but like any job if it suits you it’s way more enjoyable than it is a chore, it can even feel like a privilege at times. (Mostly it’s just pretty ‘normal’)

This is not only nonsense, but [I][U]scary[/U][/I] nonsense: as with several of your other posts, you have [B]absolutely no idea[/B] what you’re talking about.

I’d imagine that brokers have a fairly good handle on which clients are consistently profitable and which are not. I’d even venture a guess that some brokers may even piggyback their best clients from time to time?

You are gambler, not trader bro, that’s why you are losing. Genuine trader never feels addiction to trading, its like a daily routine job for you. When you will try with new deposit just imagine for a second that you lose everything. Think about that for some time. If you are ok with this losses then you can proceed. You DON’T have to feel joy from winning trade and sadness from losing trade. If you lose emotional poise you are doomed to lose.
As an option, spend two weeks for analysis and a couple of days for a trade. I do 1-3 trades monthly and after 9 months of trading just slightly above the breakeven. Because emotions gained control over me forcing me to make wrong decisions.

mh,
Absolutely & they’re rarely opposed, especially those who continually identify & surf strong dominant short & medium term flows, because usually when they’re (the minority) surfing those strong waves the mug punters (the majority) are frantically swimming against them.

And in the main, that type & flavor of activity denotes which group or characteristic of punters you lay & which group you play! These days the machines sort, filter & stack all that stuff out, but in theory that’s still how it plays out.

It’s really rather simple. Just trade a micro account for 0.01 lots per trade, only cents per pip. Do that until you learn to make a consistent profit. You could have paid for your entire Forex education many times over for much less than what you lost at the very beginning. The only tough part is that it will probably take 5 to 10 years of steady learning before you learn to trade for a profit. Most traders do what you did and try to trade for large profits before they know what they are doing. That’s not a scam, it’s just a very common fault in human nature. The first thing you need to learn is patience.