Hi my name is go00053 or simply Gp. I have been a member here for a number of years. I haven’t been available for the last little bit, but like a bad cold, I’m back.
I am a full time trader and have learned most of what I know from this site and what I didn’t learn, this site led me in the direction I needed to go to find the answer I was looking for. Now I would like to give back. The main thing I learned when you cut through all the BS, is the answer to what you’re looking for falls into 3 categories: 1. Black, 2 White and 3. Grey. Most answers I found fall into Grey.
So if you have a question and I can help, be glad to do it. I will check into the site every day and like I said be glad to help if I can.
Before anything else, thank you so much for this! We really appreciate your willingness to spare some time to share your knowledge with us.
Most of my questions have actually been asked by ZoraEggs so I’d look forward to those answers too. But I would just like to add this:
How much time did you put in before you decided that you’re skilled enough to become a FULL TRADER? (You know, since a lot of people say that it’s hard to live off of what you get from Forex.)
How are your experiences with forex brokers? did you have any trouble with any of them?
Hey Zora
There’s a saying “Where there’s smoke; there’s fire”. I found in forex when there’s a hint of smoke the safe thing is to assume there is a 5 alarm fire. I have had bad experiences with some brokers, mostly in the beginning. The main reason was laziness and a little bit of knowledge. (a little knowledge can be dangerous). You have to realize that #1 all brokers are in business to make money and there are a lot of different ways they go about making it. Some brokers want to make more with less traders, others want to make their money with more traders. Some will only do business with you if your deposit is 100k or more, some will do business with you for a dollar and everything in between. Some will do business with you if you deposit a dollar but will give you a whole bunch of goodies if you deposit $5000 or more.
So my rule of thumb is nothing is free. . you’re going to pay somewhere for: bonus, contests, account managers, straight through processing, market makers, training programs, account managers, signals, vpns, leverage etc. In forex there are a few definite results or guarantees; mostly you’re dealing with a balance of probabilities. Doesn’t mean that a broker who’s been in business for 20 years won’t close up shop a leave with your money, just like doesn’t mean someone who has been in business for a year will. So to put the balance of probabilities on my side, my rules for brokers are:1. In business minimum of 5 years, 2. I Search Google, their licensing authorities, as well as a couple of review sites and trader forums. If I still don’t have a clear picture, I would go to trader discussion forums and ask who’s had experiences with a particular broker. Next make sure the broker you choose fits your trading strategy. For example a broker who offers low spreads on EUR/USD would not be of interest to me, cause I don’t normally trade that pair. If a broker doesn’t allow scalping, it doesn’t matter to me because I’m a swing trader.
So once I found a broker who is good for my trading strategy, the next thing is put them to the test. I do that by opening a demo account to see how their platform works, live chat, their different back offices and questions to the rep. If that all checks out, I open a live account and make a deposit, live trades and withdrawals. If all that works out. I make my trading deposit. Like I said that’s what I would do now, that’s not what I use to do.:>( Trust me it’s work the time it takes.
Are you able to earn a consistent monthly profit? can you live off it?
The short answer is yes. There lots of retail traders who make a living trading. Howwwwwevvvver, it is not an easy road. For example you will get a lot of: I’m a super star, I started with $10 and year later I’m a millionaire; use my super duper secret one of a kind trading system and you can be like me, You are a sheep among wolves; veracious wolves. As a retail trader, you can never be a wolf, but with a plan, proper money management and time you can become a fox. And a fox can make a living amongst the wolves.
What are your opinions on scalping vs long term trading? which gave you the most success?
I have done both. Personally my trading strategy is based on longer term charts. Having said that, I don’t set and forget; I come in and out of a trade based on longer term charts. I have a friend who’s very successful using 1, 5 and 15 minute charts, for me I didn’t have success doing it and didn’t enjoy it more to the point. Again your success will depend on a trading strategy that based on the balance of probabilities that will work more times than it won’t, and when it doesn’t work, proper money management takes over.
How is your risk strategy?
My risk strategy is based on the particular trade I’m trading. Before any trade, I have a written trade plan, short and long term. I work out a lot of what ifs and deal with them as they come. When I first started I used a fixed stop based on risk/reward, biggest mistake I made, in my opinion. Know I would suggest a percentage of trading capitol.
Which % of your portfolio is forex?
It varies but I used profits from forex and real estate sales to buy stocks, etfs, real estate that I flip and income real estate that I hold.
What style of analysis do you use? for example 80% fundamental and 20% technical, like what ratio?
There is no fixed ratio, or percentage; I use everything I can get my hands on including the kitchen sink. I’m looking for a complete picture of the trade I’m considering. Most of my trading day is gathering information in order to make a successful trade.
What is your opinions on cryptocurrencies? would you ever invest or maybe just trade them?
Just had this conversation with my son. I told him there’s no money in going down with the ship, or being first through the door. The only way to be successful retail trader is to trade long term and limit risk. Whether you’re a intraday, day or long term trader trading forex, stocks, commodities CFDs, ETF’s or buying real estate, you have to limit you’re risk. My personal opinion right now is to soon. Too many ground floors collapse. My opinion anyway.
I would say around the 5th year of trading I decided to focus full time on trading I was involved in a pretty bad car accident and while recovering I just tried harder to be a better trader. I tried after a couple of years when I first started and lost $50,000, then took a long hard look and made changes. Thinking you’re the smartest thing since sliced bread and being the smartest thing since sliced bread is quite different. You’ll get there; Time and Patience
Gp
Thank you for such detailed responses, GP! These are highly appreciated.
I sure do hope so! I’m determined to acquire as much knowledge as possible and take this journey one step at a time-- slowly but surely, as others would say.
Hello GP it’s amazing to have you help us here at babypips, much appreciated, there’s a question I’ve been trying to get an answer to. In forex trading, when we have losses where does the lost money go to? Is it the broker or interbank exchange or some random trader on the other side of the world? And where does the profit come from too? As in who’s responsible for crediting our trading accounts when we make profit from trades?
Let me start with your welcome, it’s actually my pleasure to try and help. Firstly when I say help, I don’t mean do your work. I mean help you to do your work. I will help you by first telling you that most of your answers can be found at the babypips school and google. Next all my posts are my opinion and my understanding and what I base my trading on. That doesn’t mean it’s necessarily facts. For example I believe the majority of forex brokers are not scammers but legit businesses. That’s my opinion. 2+3=5. In my opinion that’s a fact. Now onto your questions.
Most traders will agree that brokers would be classified into the following: Dealing Desk/Non Desk. Babypips or Google will define the difference. From there we break it down to: Market Maker, STP, DMA, ECN; same thing babypips school and/or google will give you answers. It’s better for you to do this work, because deciding on what broker and how to choose a broker is key to long term success. Now I’m not trying to be cute or evasive to “where does the lost money go?” If I was lazy and didn’t want to do the research, I would say. . .”Who gives a Sheet?” “It’s not going in my pocket, so I don’t care where it goes as long as I’m not being cheated. I’m more concerned as to why and did I do something that caused the loss. How do I figure out if I’m being cheated? I go learn basics of how brokers are classified from babypips school, then I research the broker to see, then I make an informed decisions based on relevant Facts, Real Options, then I pick the Least of the Evils; not fool proof, but works based on the balance of probabilities long term. (If you don’t understand what that phrase means, “balance of long term probabilities” make sure you look it up, understand it don’t stop until you do then live it. Generally speaking your losses go to the other side of the trade as well your broker takes their cut. For example in my case my broker charges me a % based on lots I trade, so If I had a losing trade and I was long, the short side of the trade gets my loss, my broker gets the % they’ve charged me to trade with them. Like I said Generally.
As far as responsibilities to your account, that’s your broker. Again found at babypips school. Yes brokers take the other side of your trade, and it depends on your definition of cheating. In my opinion, taking advantage of an uniformed situation is not trading. Is it cheating if a broker takes the other side of your trade if you are over leveraged, over trade, don’t have a loss protector? Like you, most brokers who take the other side of your trade are playing long term balance of probabilities. As well I would also say yes some do cheat but personally I don’t believe it’s wide spread, again only my opinion. Brokers will categorize you depending on your winning, losing and profitability. They’ll place you in what’s called “A” and “B” books. I read this somewhere and questioned my broker about it he said in some cases probably true, but in my brokers case he said they take their commission and send it to market. This is what I read; As a new broker client, Forex brokers will keep your trades “in house”. Basically your trades aren’t sent to the real market. The broker will execute your trades and bet against you, taking the other side of your trade. Why do Forex brokers put you in the “B” book? Firstly, because the “B” book is a profitable business model. Statistics prove that 90% of traders lose all of their deposits within 6 months. So the stats favor the broker. IG Markets holds the biggest “B” Book in the world. Why do Forex brokers put you in the “A” book? Brokers will put you into the “A” book if you’re profitable. Brokers send profitable traders out to their liquidity providers because no one wants to bet against profitable traders.
All my trading strategies are the same. I do not trade any economic or major events if I can help it. I wait until after the event. I know traders who do trade news and economic events and they say it’s profitable, but to me, I don’t try and pick tops or bottoms in price moves, I go in between, when there are no events posted or to be announced.
I hope that anwers your question
Gp
I have a question regarding stop losses, or more specifically, their use and usefulness.
I read a lot about whether to use them at all, where to set them, how to work them out etc, and I understand these points. Personally, I will use them if I decide to trade.
But I also hear an argument that it’s a good way of advertising at what point you’re willing to take a loss (to the broker). Does this mean that you’re open to price manipulation by the broker, or is this only really an issue if you’re setting a stop too close to the market price?
I’m unsure as to whether the conflict of interest is warranted when the broker takes the other side of your trade.
Before I even down load a brokers software check out the following.
The Broker has to be in business no less than 8 years
Broker has to be regulated and must be a non dealing desk
Broker has to be reviewed, by some public rating companies, trader net works, both paypips and Forex factory
I gather every piece of information I can before anything. Doing this first has never let me down
Then I check out my rep, how long, what’s is basic storey and I verify all that.
Then I download their software platforms. I only use MT4 so that’s a no brainer
I check their spreads on the currencies I trade, if they are swap free or not.
All trading funds must be held in a Seg Fund.
Then I check customer service and verify
I make a deposit trade withdraw and see how long that takes and why
10 Then I deposit whatever I’m trading with that broker and go to work.
I trade larger accounts, I’m profitable, no trouble (usually) so I normally have a personal account manager who cuts out a lot of BS… In the beginning I did most of this by myself and never hada personal acct manager.
I do not believe the type of broker I look for manipulate and thing. They’re make their money from a commission they earn from my trades and my business.That’s my opinion. I have never found that openly admit they cheat their traders. They make money like we do based on the balance of probabilities
Stop losses have3 main purposes for a new trader in my opinion
Protect you from a loss that wipes out your trading account
Lets you experience losing money without losing you trading account
Gives you the confidence to work on your stop loss strategy to make it more efficient.
Example when I started my Stop loss was 5:1 means 4 winners 1 loss, never worked, lowered my time frames lowered my stop loss ratio had a little success. I only traded 1 pair so I learned lost about the pair allowing me to lower my time frame and stop loss. 8 years later My stop goes in before my entry it’s only purpose is to protect me against a major loss. But this takes time, patience knowledge will power and experience. Be smart pick a ratio 3:1 4:1 play with it, Again my opinion
Best thing my advice don’t do anything. Brokers aren’t going away only the scammers. Take your time and build you forex knowledge that will help you in your decision making policy
Good Luck
Gp
I have always wanted to trade at most 4 pairs swing trading but have always found it hard as I find my self checking other pairs when mine are not showing anything and before you know it you end up missing trades on your pairs coz of the divided attention.
Am wondering how many FX pairs do you trade and do you think it’s a good idea, it’s something I really want n believe it will improve my trading.
It’s also comforting to know that there are people doing the same who can share their experience on trading one or less than 4 pairs.
You’re very welcome. In my opinion. With swing trading you the more you know about the pair you’re trading the more effective your trading method will be. I’m pretty sure that is the way with all trading. For me my swing strategy has been the most effective so far on the 1 hour time frame, with GBPJPY. I trade full time manually. I set up just after Sunday Opening and depending I’m out or at least want to be out by Friday close. On the one hour with pair I find I’m in and out at some specific times. I do have some longer turn trades that are trend and Fibonacci based. They’re more set and forget. But no question for me 1 hour swing trading increases my trading account by the largest percent. I don’t think I can devote anymore time to look at other pairs. Because of Brexit, I am looking at the USDJPY I have been thinking about increasing my business by expanding the pairs I trade using other traders signals, managed accounts, a traders group. But no where near ready to make that decision. I have some heavy personal commitments for the next few months so all I’m doing right now is looking at alternatives to my trading.
Here’s my plan for expanding my business Plan Plan Plan and write down ideas and reduce to a written plan based on facts, options and go with the least of the evils. I will do a lot of research from many different sources before I add anything to my current overall trading strategy. Some I will pay for, most I will do on my own. But I will do it before I add anything. Next put it to the text and see what happens, if it works; another test and so on. My over all strategy is long term.
Hope that helps
Gp
Ok, this thread will be an inspiration and support system for the new traders. As forex is a challenging field, every new baby has the yearning to receive expert guidelines before he can start trading with his real money. I am truelove appreciating your initiative to help the others.
Thanks for doing this.
