ONLY if it’s going to make me famous!!! LOL!!!
Here is MY ‘take’ on your questions:
[I]Could I earn my living by trading currency?[/I]
Yes you COULD. WILL you be able to earn your living by trading currency? PROBABLY NOT (statiscally speaking). Statistics quoted would have us believe that only 5% of traders (that includes forex traders, stock traders, bond traders, commodity traders, the list goes on) will be successful (and I can only assume that being successful in this business MEANS that you are earning your living FROM trading). THIS BEING SAID THOUGH: I’ve not ever seen HOW or by WHOM these statistics were compiled. I know that I MYSELF simply regurgitate this figure when asked so THERE is some research you can do FOR US!!! LOL!!!
[I]So, do any of you folks out there live only on the money you earn by trading currency?[/I]
No. Trading has cost me just about if not everything that I’ve ever owned (and then some). Fortuanately (and due to the faith that some people STILL have in me): I’ve been afforded the opportunity to open a new business which is ‘trading related’. Do I BELIEVE that one can BECOME a successful trader and live only on the money that you earn by trading currency? Yes I most certainly do (although for me PERSONALLY trading CURRENCY is not the way to go).
[I]If so, what do you think is needed to do that? I’m thinking here of personality, education, etc.[/I]
Personality: let’s refer to it as ‘trading psychology’ shall we. If you are unable to master the ‘psychology of trading’ then you WILL fail. We are NOT as human beings programmed to lose ANYTHING ESPECIALLY money and material goods. As a consequence: a person (an unsuccessful trader) will hold on to a losing position in the HOPE and, in most cases, the GENUINE BELIEF, that the position WILL EVENTUALLY turn around and move in their favour and they will make a profit. It very rarely happens this way. Unfortuantely: cutting your losses when you are wrong on a trade is one of the most difficult things to do. Even MORE difficult is being able to ACCEPT those losses and MOVE ON WITHOUT getting frustrated with, and angry at, the market because this INEVITABLY will have you try to take revenge on the market with disastrous results. Once you are able to VERY CALMLY ACCEPT that you are wrong on a trade, take the loss, and move on to the next trade, I then believe that you have already won 95% of the ‘battle’ (remember the 5% noted above).
[I]Education?[/I]
Formal education in the field e.g. a degree in Economics? I doubt that it’s NECESSARY but I’m sure it would be HANDY!!! It depends. If you’re going to base your trading on the FUNDAMENTALS of the market then I don’t see how you can be successful WITHOUT such an education. Education by way of experience? In my opinion: this is the ‘definitive edge’. In other words: I believe that somebody who immediately went into this business ‘right from the start’ and has a few good years of experience ‘under the belt’ will have the ‘definitive edge’ over anyone who has formal education in the field. They will have something called ‘market savvy’ (ESPECIALLY if they’ve worked in a bank or, better yet, as a floor trader at one of the exchanges). A fine example playing out RIGHT NOW is the fact that the stock market is rallying (Friday’s minor corrective action aside) but it’s NOT supported by the FUNDAMENTALS AS I UNDERSTAND THEM (my understanding of the FUNDAMENTALS almost ALWAYS being wrong that is). The floor traders (and those traders with years of experience), however, have the ‘market savvy’ that enables them to take advantage of ‘Joe Public’s greed’ (which is, at the MOMENT, sustaining this rally in my opinion). The third ‘educational alternative’: PURE MECHANICAL TRADING (and this is where I myself will probably always be ‘at’) coupled with some basic TECHNICAL ANALYSIS. I would hazard a guess that MOST books and Internet websites ‘dedicated to the cause’ cover these two aspects more than anything else so there is much literature on the subject and no formal education or experience is necessary to grasp these concepts.
NOW: do I get to put my company logo on your paper along with our contact details??? Anything like that on offer??? LOL!!! I AM ONLY JOKING WITH YOU!!! I hope that what I’ve had to say helps you with your paper!!! I’m SURE that others will contribute as well. Good luck.
Regards,
Dale.
P.S.
Our website address is … LOL!!!
