My 5000th post: a video on dealing with margin call and blowing up an account

Hello traders!

So, you may remember my video in July, ‘A Year in the Markets’, where

I laid out my trading positioning and the reasoning behind it, complete

with a reflection on how my drawdown had steadily increased through

the months of holding the same positions; in the end, the [B]‘fat finger’

event of the night between Thursday 6th and Friday 7th October[/B] pushed

the Pound to new lows, and I got caught out, badly.

The following video was made in the aftermath of such a cataclysmic event,

reflecting on my feelings and on my strategy with regard to my account,

now reduced to zero:

Please watch at least some of it, if you have time, and


INCLUDING HOW YOU DEALT WITH THEM: did you admit defeat or did you take this as a lesson

to better yourself?



Pipmehappy, you seem to be trading for quite some time now, so how haven’t you already learn to use a freaking stop loss?

It is not as easy as that, yourMother, it was not laziness or lack of understanding, I can say that with confidence…

Just watched your video, highly commendable. This may help other traders to evaluate their trading, particularly if they are currently struggling.
Im sure you will come back a better trader than before, best wishes

Firstly, Frances, my sincere condolences for such a sad ending to your first “life” as a trader. I have been waiting for your 5000th commemorative post but never expected it to be this! :frowning:

Secondly, my sincere respect for you that you are picking yourself up from the floor, dusting yourself down, and examining what can be learnt from your experience and then applied as you move on to your second trader “life”! :slight_smile:

Thirdly, my sincere thanks to you for the courage and willingness to share your experiences and their impact with others so that they may learn something!

The following are [U]only my [/U]personal thoughts on your story and not any kind of recommendation:

You are clearly a very intelligent person and have been trading with a specific plan and clear objectives. You also follow your markets with a continuity and consistency that excludes negligence from the reasons why your plan did not succeed. So we should ask ourselves what actually did go wrong?

My first thought is that your experience casts a shadow over the theory that long term trading is “automatically” more reliable than short term. Maybe in the past that has been the case but I think currently we are experiencing a different kind of market environment. It seems that currency markets are not so driven by purely economic factors any more, which seems mainly due to the fact that most of the world’s authorities are trying to mechanically bump-start their economies instead of just tinkering with gentle touches on the throttle and brakes in otherwise healthy economies. This has led to a situation where markets are just watching the Central Banks’ activities and jumping from one conclusion to another. This has led to abrupt reversals and upheavals that can reverse directions from one day to the next and in a violent fashion. Of course, Brexit, is its own unique event in all this.

It has been quite an eye-opener to me to “play” with my broker’s simulator and watch market movements in a fast-forward mode. The speed and depth of direction reversals can be unbelievable. Therefore, one could conclude that, if one is seeking to earn consistently from forex trading, then there is a great risk of failure at some point in extended, continuous, exposure in a market. This underlines the principle that any trade should always have (at least) three components: 1) a reason for entering the trade at the chosen level, 2) a pre-defined target for exiting it, 3) a pre-defined level for aborting it that both negates the reason for having entered it and also meets the defined risk management criteria that keeps a possible loss within the absorption capability of the account.

The second thought concerns the psychological consequences that can result from such an experience. It is impossible to imagine the feeling of sudden loss after months of analysing, following and managing the same positions only to see them closed out by the broker after a sudden unexpected move. It surely must remove all the reference points on which one has based one’s trading strategies, tactics and manouveurs. One has to start all over again from basic principles and question every aspect of one’s earlier approach to trading. But recovery from such a psychological blow is not at all easy - and therefore all the more reason to avoid such a situation happening.

Personally, I have considered many times the option of becoming a full-time trader, but I have always come to the same conclusion. It is far better to be a full-time trader in constantly watching markets, but not to rely on it as one’s sole source of income. Full-time trading might sound oh so attractive in many ears, with its expectancy of freedom and riches, etc, but reality is mostly far from that. Relying solely on trading income puts so many additional pressures on one’s trading frequency and performance. Everyone knows that trading income is going to be irregular, but it also contains the risk of sudden proportionately huge losses that diminishes one’s trading capital such that future trading is even more difficult and demanding in order to maintain a required level of income. The intensity and uncertainty of forex trading as a sole income source may well be sustainable and enjoyable for a period of even many years, but for many there will come a point where the stress from demands for constant performance, even as market characteristics also change, becomes overwhelming and sucks all the pleasure and sense of achievement out of trading. It will then also start to eat away your interest in life’s other blessings and draw you into a negative state of obsession with prices and profits. If and when that occurs and you find you cannot continue as a full-time trader, what are you left with…

Personally, I think it is far better to keep trading as a full-time interest, but only as an additional income source. That way you trade when and where you wish, as much or as little as you wish, for as long as you wish, and even a string of losses is not a critical factor at all - trading is then healthily kept in proportion with the other, far more important things, in life - and one can even go on holiday with a peaceful mind! :slight_smile:
In summary, success in trading is clearly not guaranteed just by adequate intelligence, experience, dedication and consistency or by the choice of short or long term trading. It is most likely to be achieved through a defined and rigid limitation of risk exposure and an equally strict management of funds. All trading is based on probabilities and therefore all risk/money management considerations must also include protection, as far as is ever possible, against the impact of sudden dramatic moves such as these.

Thanks again, Frances, for sharing.

:slight_smile: At least you know how to make money when the next country leaves the EU .

A stoploss didnt help too much with that pound spike. I was lucky i was watching the the chart when it happened and was able to buy near the bottom.

Hope you re-evaluate and decide wisely how to invest your money :wink: Sometimes the only way to win is to quit.

I really value the fact that you all took the time to look at my video and put your thoughts in writing: I particularly want to thank Manxx for his really insightful and articulate response, which I will read again a few times to digest its layered content.

I will be demo trading for a while, and thinking hard about where to put my money to work.

It is a hard environment for savers and I would like to find a way to put some money to work in a more fruitful way.

Will forex be this way? The jury is out.


The only suggestion I can make is to have a think about a micro account, maybe in USD, maybe in a month or so.

You may find motivation difficult on demo having come though the mill with GBP.

I remember you once saying that long term trading is close to being an investor rather than a trader and thinking about the difference in both disciplines.

Anyways many thanks for sharing your experience, probably the pound will get to the spike territory eventually the way it has been going (aside from today’s respite).

Edit: I can hear a song ringing in my head - loud and clear :slight_smile:

Have you considered trying to trade short term? There’s nothing inherently wrong with trading long term, but it will take you forever to learn. Look it took you 1.5 years just to realize the importance of a stop loss. That’s slow, too slow

Pipmehappy I have not posted on babypips for almost a year now, but still lurk here once in a blue moon. I felt a strong urge to comment after seeing this topic by you.

some constructive critisim I shall throw your way.

you post far too much on here, and the majority of it does not seem to be [U]trading system[/U] related, and a large chunk of it seems to be socializing. I was not surprised at all when you revealed you were the TOP poster on babypips, because each time I stopped by most of the first page of topics had your post being the last post. If you are not yet profitable the majority of your posts should be directly to do with trading eg: posting graphs with trades you have taken and getting feedback from [U]someone who knows what they are doing[/U]. I don’t see the point in spending ages flirting with pip n roll or making topics praising female traders …or a lot of other generic topics I see traders spending lots of time on like how much can you make with forex …or what time frame is the best …etc etc, that stuff is very subjective and will do little to turn someone from unprofitable to profitable.

second thing I am actually wondering is where did you get your strategy from? are you following a proven strategy which is being taught to you by a profitable trader or did you make the strategy yourself? There are very few strategies being taught which hold positions as long as you are doing.

and lastly this is my opinion on babypips in general. Babypips is a great website designed for the [U]newbie trader to intermediate trader.[/U] You get very few [U]big boys[/U] hanging out here and teaching. Most of the threads teaching people how to trade on here are made by people who themselves do not know how to trade. There is a lot of blind leading the blind here. There’s a few people who claim to be long term profitable who I see posting in this section but they are not teaching here, just dishing out “general” advice every now and then.

If one is looking to become profitable in forex he is better off not trying to reinvent the wheel and better off to start learning from someone who knows what they are doing. Think of a thread which contains a trading system like a university. There are good universities in life and there are universities which are crap. If a learner is serious about learning he wants to get into the best universities and learn there, likewise in forex you should be looking to find the best threads …aka universities.

you have a better chance of success if you go to a good university.

why do people want to go to Oxford/Cambridge or Yale?

They have the best teachers and have reputations for students graduating with very high marks and going on to succeed in their field.

The first thing anyone should do when thinking about picking a thread [university] is to ascertain the competence of the teacher. Is there a myfxbook or trade explorer? …how long has he been trading the system? … Is the teacher showing images of trades that they themselves have actually taken or is it all hindsight trading “you could have bought here!, you could of sold here!” …If there is no myfxbook or trade explorer and the person is claiming to be profitable then you will have to use your own judgement or gut to ascertain weather or not this person is long term profitable.

why do people want to go to oxford/cambridge/or yale? These universities have a good record of turning out successful students with high marks!

when screening a thread, you should be looking through the thread to see how much people [learners] are actually long term profitable with the method. Sometimes someone can be a fantastic trader but a bad teacher. If the thread is not turning out profitable long traders that is an indication you are not looking at a 5 star university.

Is the topic creator [teacher] still active …or is he no longer concerned about the thread and left it to his own devices [students are running the thread]?
would you attend a university where the teacher was absent and the students were in charge of teaching? …I wouldn’t.
Sometimes in forex though you might get someone who “adopts” the thread in the teachers absence and is now essentially the teacher but before learning from him you need to access his competence and ability.

How established is the university you are going to?
Do you want a university that opened last month? or do you want a university that has been around many years?
When searching for a thread to start learning from you should be looking for threads with AMPLE learning material. If the thread has less than 500 pages then it is not long enough imo.

what is your teacher like? Does he type in a style you can’t understand or broken english? , does he get angry when people ask questions? , does he actually answer people when they ask questions or does he just ignore most of them?
What would happen if you were at school and didn’t understand something and your teacher would not help you and answer your questions, do you think you would get a good mark? If your forex teacher is not answering people’s questions when they are asking for help you are better off finding a new teacher/thread!

how much monthly on average is your teacher and his learners earning?
if your teacher is earning an average of 10% a month using good money management do you really think it is realistic if you are looking to make 25% a month? …that would mean you would infact be better than your teacher!
when picking a method to learn it is best to assume you will be earning less than the teacher should you master the system and make yourself into a profitable trader. If you are already profitable before coming to the thread then it is possible you may be able to outdo your teacher.

The reason I stopped posting at babypips was because after reviewing things I felt I had come as far as I could in the thread I was learning from, the teacher was not active, when he was active he didn’t answer questions, and just 1 person had claimed to be profitable long term following the method and he wasn’t even using the whole method just an aspect of it.

I could not find any other decent threads on babypips which met my criteria so left and found a better forum with threads which meet that that criteria and my trading has improved a great deal.

I guarantee pipmehappy if you screen threads like this you will have a better chance to become profitable.

1 Like

There are many very good points in your post here Def, but I would like to comment on the above sentence.

Whilst I agree that there are very few (if any) threads here that are teaching a specific method, and teaching it successfully, I don’t really feel that those kind of threads are the [I]only [/I]useful content and criteria of a good site.

As you say, this site is aimed at a beginner/intermediate level, and the tendency would be that Newbies would simply attach themselves to such a thread and blindly copy it without any apparent need to go any deeper into the underlying principles of good trading and a good trading method.

The risk there is that, as you say, the teacher eventually disappears or loses interest in answering the same constantly repeated questions. Also, in many such threads it is not long before participants start suggesting their own changes and improvements and the original method becomes diluted and ineffective. In addition, market characteristics change and methods usually need to evolve with them.

Also, except with an entirely mechanical system, different traders will end up with different results even though they are using the same method. There are always the human elements impacting position size and entry /exit decisions.

Therefore it is, in my opinion, most important that inexperienced new and intermediate traders learn and adopt the basics of risk analysis and control as well as funds management and basic good business principles. There are some excellent experienced posters on this site that are more concerned with training Newbies in these matters so that eventually they may better develop their [I]own [/I]business and trading methods than simply following someone else’s instructions and jumping from one teacher to another.

If a site can generate both good trading principles [I]and [/I]good, proven, trading methods then it really has achieved something truly worthwhile. :slight_smile:

Hello Defiance,

thank you for your frank and insightful post, which, like Manxx’s, deserves praise for how well

written it is and for the time it took you to pen it.

As any critical thinker would do, I would courteously reply to your points in order:

  1. I DO spend too much time on Babypips, and it is indeed a way to socialise with other traders,

    given that I do not know any in real life; however, no matter what sort of trading you do, if

    you trade in isolation then it is not uncommon to want to come on a forum and chat about

    trading-related topics;

  2. BabyPips talk should not all be hard numbers and ‘system speak’: besides, you make the

    assumption that the gold standard is day trading, made of precise targets and day-by-day

    measurements, but that exclude a lot of other kinds of trading that do not have such a set-up;

  3. even if a successful trader was happy to share, it is not their duty, and as you say, someone like

    Lexy, PipNRoll, or Emerald soon got tired of talking about THEIR success, because they have a right

    not to become enslaved to this site as de facto teachers;

  4. the female traders thread is not a hook-up thread, and I am

    very happy to hear from anyone who wants to contribute; as it happens, feminism is a topic of

    interest to me generally, so the female traders thread is an extension of my interest. There can

    be male feminists, although this is a hotly debated area that I am not qualified to try summarising

    in a few words here. The point is this: if I knew anything about ethnic and minority traders, I would

    start a thread on that too, but as it happens I have no knowledge of that, so I stick to something

    that I feel I know a little more about, which is the ‘Rise of the Female Trader’ and s e x discrimination

    in trading. This has nothing to do with real-life trading, and of course it adds little to my P/L, but

    then we all choose how we spend our time online;

  5. Oxford undergraduate fees for a typical three-year programme in 2017 equate to about £ 28000:

    the kind of teaching you have in mind, therefore, does not come for free, unless you are either

    in contact with someone that is real and tangible and just happens to like you enough to take you

    under his or her wing, or in some sort of online trading circle where there is clear evidence of

    success and support.

    I would love to pay for someone to tutor me while I trade, but I do not have money to do that, as it

    is not my chosen career; your points are valid and in all honesty they should be included in Eddieb’s

    Newbie Trader thread, because they matter. I do not hope to find such a mentor on BabyPips, although

    I found some great people who have given me huge support during hard times, like Lexy, PipNRoll,

    SimonTemplar, Eddieb, Manxx, Turbonero, Yohec, Baz, BobBillBrown, and probably others further back

    in time. Each of them helped me cope and helped me question my trading, just as the great Jason

    Rogers of FXCM, who is a fantastic and tireless supporter of newbies and not-so-new traders.

To summarise: I am not doing well in my trading and need to overhaul my way of thinking,

but how I choose to spend my spare time on Babypips is entirely independent of my actual

trading… I actually have made contact with some of the BabyPips members off-line and

we are discussing trading away from the site, so I have those needs met away from BabyPips…


I am (once again, and for the usual reason) without speakers at the moment, but looking forward - with interest and some trepidation(?) - to watching the video when I can, soon, PMH. I mention this mostly by way of apology for my lack of response to a thread in which I’d otherwise be participating. :8:

It strikes me that the same “objection” could certainly be levelled at some of my own posts here, Defiance, so I hope and trust you’ll excuse the observation that that [I][U]is[/U][/I] a perfectly legitimate and welcome use of a “forum”. :33:

Hello Lexy…

Well , I know about your speakers :slight_smile: You are not missing much, just me moaning about how bad it all is

and how I am going to make it all better ;p

Pipmehappy …you are a likeable character, I would like to see you hopefully get yourself on a good path to profitability hence my constructive criticism regarding the way you conduct yourself on this site.

It is my personal opinion that if a trader is not yet profitable he should focus most of his attention [U]directly[/U] on trading. You have teaching that you do for work, you also have a baby now and are dealing with family life, you socialize on here a lot too, you probably have friends in real life too that you socialize with. It makes me wonder how much hours you have in the day to actually put into improving and learning.

you say after I made this post that you are talking directly about trading away from the site with other babypips members, I am pleased to hear you are talking about trading. All I can say, is that I hope these people who you are talking about trading are long term profitable and actually [U]teaching you[/U] their method, and have track records for producing profitable traders. If they are not doing these things then you are better off cutting back on your interactions with them or your socializing from babypips so you can use that time and find a place where you have the best chance to improve your trading. Don’t mix too much business with pleasure, if these friends/traders are not able to help you improve because they lack the skills/expertise or lack the time to teach you then it is your responsibility to search for a better learning environment.

At the end of the day, remember why you got into forex. To earn money, and that should be your primary focus.

friends don’t pay the bills, remember that.

Manxx has made some points in his last post about experienced traders on babypips wanting to give newbies the skills so that they can make their own method and are not “simply following someone else’s instructions and jumping from one teacher to another.”

whilst the intentions by the experienced traders he is talking about is are in the right place, the hard reality of forex is …is that it is very difficult to become consistently profitable following a system taught by a teacher, but EVEN MORE difficult to come up with your own consistently profitable unique system if you are a trader who is not yet profitable. An unprofitable trader who is refusing to follow a tried and tested system and is instead trying to put together one himself has a less chance of attaining profitability than an unprofitable trader who is following a tried and tested system taught to him by a profitable trader.

The advice I gave you was to give you best chances of attaining profitability [without paying a dime]
can an unprofitable trader attain profitability by making his own system? Yes it happens from time to time. But far more often if the unprofitable trader has become profitable is because he is following a tried and tested system.

Pipmehappy Should you be one of those traders who has spliced together his own system, just be aware that you are less likely to succeed that someone following a tried and tested system.

Oxford undergraduate fees for a typical three-year programme in 2017 equate to about £ 28000:the kind of teaching you have in mind, therefore, does not come for free,

yes that teaching can come for free. If you can find a thread [and there are [I]some[/I] threads like this on the internet] where the topic creator is profitable …and the thread has produced several consistently profitable traders producing 10%+ a month then that thread you are looking at has just as much value as that £28000 oxford university course, if not more due the potential of being able to consistently generate 10%+ a month.

yes, the teaching and attention you get in that thread from the teacher is never going to be the same as if you hired a teacher and he was sitting right next to you, but if the thread is producing profitable traders than that is an indication that the teaching in that thread may actually suffice.

It strikes me that the same “objection” could certainly be levelled at some of my own posts here, Defiance, so I hope and trust you’ll excuse the observation that that is a perfectly legitimate and welcome use of a “forum”.

lexys, I agree that it is a legitimate and welcome use of a forum.
Just like playing on a school basketball team [in America] is a legitimate and welcome use of the schools facilities. But if that kid is flunking his studies, he should be concentrating less on basketball …and a lot of schools will take a kid off the school Team if he is flunking his studies.

Pipmehappy just got margin called, and his positions were looking pretty bleak a long time before the unexpected spike too.
Pipmehappy may just be that kid spending too much time on the court and not enough time in the classroom.

The difference between you and pipmehappy metaphorically speaking is that you are not flunking your studies so can afford to spend large amounts of time playing baseketball/socialisng on a forex forum.

You guys will probably disagree with my views, and that is your right ofcourse, but I made these posts here on the ofchance that he does take atleast something away from it, or somebody else in a similar situation to him finds it of some use.

enjoy your day guys and I wish you all green pips…

I did not suggest that inexperienced traders should develop their own methods [B]instead [/B]of following a proven method. What I said was that by also learning and understanding risk exposure and money management they will be better placed to [B]eventually [/B]develop their own methods and build a proper business approach that will then carry them through their future careers rather than simply following the latest in a long line of “when the red crosses the blue” systems - without even bothering to even understand what the “red” and the “blue” actually are.

For someone who admits to just lurking around here, you have a lot to say that is critical about other regular posters here, and a lot to say about what the Newbies [I]should [/I]be doing - but I see little concrete offerings from you personally. Are [I]you [/I]a successful trader? If so, why are [I]you [/I]not offering a trading teaching thread here? Or, if not, how comes [I]you [/I]are telling others how to learn successful trading if you haven’t managed it yourself?

Which is it? [B]Are [/B]you a long-term profitable trader or not? IF you are, then give PMH and everyone else here access to your method, and not just your recommendations so’s we can [I]all [/I]make money. Lets see the goodies please:)

When I first started trading I made my own method after doing some learning. In hindsight it was a crap method. The system was not profitable.

I tried a few other systems on here along the way, I soon caught onto the fact that these simple crossover systems were not going to yield any profits. I did quite badly on these systems, my account took a further battering. It kinda dawned on me around that time that not all threads are created equal and there were many many rubbish ones, I started really thinking carefully next about what threads I would enter. Eventually I entered TMB’s thread after scrutinizing a lot of threads on here. I stayed in the thread a while, slowly improving and the last few months i traded it before i stopped i was profitable. This is not me claiming to be long term profitable with the method, I would need a lot more time to ascertain that. I eventually left the thread after his cousin came in badmouthing the thread. At first I thought to myself “Troll”, but he did actually have a few good points. TMB is a nice guy, but he does not answer questions and I did not feel like I wanted to put any more energy into trading the system as I was getting little feedback from him and had concerns I was still not doing things right.

I then went searching for more threads to learn from and decided to add that the thread creator must be active and willing to answer questions to my criteria so I would not get halted in my tracks again . I could not find any threads on babypips that met my criteria and so pretty much stopped posting here. I found a thread somewhere else got involved and after a while am profitable the last few months, but this time I am getting much better feedback to my trades so think there is a real chance this could lead to long term profitability. I get regular feedback on my wins from people who are long term profitable, I get regular feedback on my losses from people who are long term profitable including the thread teacher. Infact there are some winners that I have had where I’ve been ripped into and heavily critiqued. But this is useful, because it helps you learn proper technique and avoid “being lucky” …and luck is not really your friend in forex, you need to have an edge. I also have access to a facebook group run by a long term profitable trader. I have been given “homework” or studies by the thread teacher. I’ve had things that i’ve learnt on babypips been expanded on massively, and quite frankly some of well known standard advice in the school is just plain wrong!

[U]It is easy to see[/U] that a person in a good trading environment, has a noticeably greater chance of attaining long term profitability than your typical online trader. Hence why In my first post in this thread I posted tips to locating such threads.

I was critical in the thread, yes. but not in a way that was unhelpful. Tbh, one or two things I said to pipmehappy has been said to me as well by my profitable teacher, in an even more frank tone. Once I got over it, I realized that there was actual value in what was being said and that some of it may be relevant here.

1 Like

Thanks, Def, for your background info. Firstly, I greatly admire your tenacity and determination to “make it” in the retail forex world. Secondly, congratulations on achieving a state of consistency in your profitability, albeit, that is still in its early stages.

What I see in your post more than anything else is your excellent and valuable example of the correct [I]approach [/I]to learning trading - whatever the learning process might be.

You amply describe and have demonstrated the [I]essentiality [/I]of being objective and open-minded and constructively critical of every aspect of one’s learning process - including both what goes right and what goes wrong. Objective evaluation of each aspect, combined with selective study of how it can be (even further) improved, is surely the key to making consistent progress.

Once again, I congratulate you on your efforts and results.

However, the sad thing is, which is most relevant to this thread, you also reveal the reality of the deficiencies and pitfalls of the general learning environment available for new retail traders. Basically, we are all on our own in a miriad whirlpool of infinite possibilities to learn but without much opportunity to evaluate them beforehand. For most people, learning is a haphazard process of hit and miss experiences the value of which is usually only apparent in (often expensive) hindsight.

That is why the contribution from people like you who have gone through that process - and survived - is of incredible value on site like this. Unfortunately, it seems that once people have “made the grade” they no longer visit here. It is fine to suggest that newbies should find good and genuine mentors and methods, but that is not always so easy and certainly does not remove the need for self-education and betterment if one wants to [I]continue [/I]in this field.

There is really very little incentive for a successful trader to voluntarily take disciples under his/her wing and demands a long term commitment from the mentor if he is really serious about helping others. It also limits the mentor’s own flexibility with his own trading if he has to constantly trade his own methods in order to continually present and justify its viability to a bunch of hyper-critical followers, many of whom just want the signals and the bucks…

So stick around and give the benefit of [I]your [/I]experiences to others here - it is a valuable and rare commodity in this strange industry of ours! :slight_smile:

so looonnngg posts in here. took me a while to read.

thanks for the compliment Francis.

to the rest: you living, you learn. blowing 1 account means nothing at all.

anybody here opened a business without losing parts of his investment? i highly doubt so.

the fundamental ability a sucessfull enterprenure must habe is to stand up after beeing beaten to the ground. eberybode gets beaten to the ground from time to time but the successfull ones always stand up at least 1 time more often then they got beaten down.

And Francis is standing up.

What you said reminded me of this: