Penny Stocks VS Forex! $1,500 to $1,000,000 in 2 years!

Beginner Questions
1

First of all I am not here to promote or pitch anything. I’m here to vent and exercise my freedom of speech , while addressing a critical issue in the FX community. If I get banned for expressing myself **** you in advance! :stuck_out_tongue:

One thing that I notice a lot on BabyPips is that there are a lot of people stating things being impossible. You will be sure to find someone saying its impossible to hit certain types of returns from trading Forex. I wonder why that is?!

If we are all honest with ourselves we are not trading for a hobby. We are learning how to trade for one thing and one thing only; and that is making more money so we can live a better life then we have now. If you are doing trading for a hobby you crazy! :56:

Another thing that I hear in the FX community is that one system will never work forever and I’m having a hard time understanding how that is true. Tim Sykes who trades Penny Stocks uses the same strategy over and over which has lead him to a nice fortune.

And whats even more interesting is that he has a student Tim Grittani who uses the same strategy day in a day out throughout the year and he was able to turn $1,500 into $1M. But when it comes to Forex one strategy will not work for a long time?! This is crazy.

How the hell are you supposed to earn a consistent return on your money if the strategy you are using now will be useless in a few short months?

If you watch this interview : Tim Sykes Creates A 2nd Millionaire Student From Scratch - YouTube

Notice how at 35 seconds Tim Grittani mentions he trades the same strategy and its consistent over time. And it was obviously consistent enough for him to earn a nice Mill Ticket over the course of 2 years.

So my question is why is it “possible” in the world of Penny Stocks and “impossible” in the world of forex? All I see in Forex Forums are strategy upon strategy. EA after EA and no one is really profitable or had their lives changed from trading Forex.

I guess that proves that most people who trade Forex do fail.

If there is a FX Trader that is consistently profitable at a very high percentage it would have to be Shirley Hudson who trades the London Close. And she is 94% accurate according to her spread sheets. Now I will wait for the doubters and the impossible thinkers to say dude thats the lie and its impossible.

the truth of the matter is that she looks for the same set ups everyday and has traded the LCT consistently for a few years now. But most people say that trading strategies cannot work that long.

Most common things said by people in the FX community:

  1. That strategy won’t work forever
  2. It’s impossible to turn a small account into substantial profits
  3. 60-80% accuracy is impossible
  4. That strategy won’t trade that consistently forever
  5. You need have a million strategies if you want to succeed at FX.

Why arent there any real stories like this about FX traders?

Why are FX traders told that a strategy won’t work consistently over time?

Why is it that a PS trader can master one strategy and earn consistent returns while the FX trader as 10+ strategies? (Rookie and Pros)

2

Interesting points made. My understanding is FX has a larger appeal and keeps going 24/7 for 5 days. Stocks have set trading sessions and is more tied (most of the times) to the fundamentals of the firm or company. This different dynamic means volatility is greater in FX as different groups of traders from different sessions make calls on pushing a pair up or down. Fundamentals are harder to come by and news is mixed with expectations.
So when setting stops, this can close out a trade before it moves the way you’d normally expect. So some strategies will work well for a period, then as the dynamics of the market changes, this can change the volatility and so the pre-existing strategy fails in the FX world.
Stocks are steadier and more set in its pattern.
Hope this goes some way to give some answers. I fear it is only a very shallow attempt.
Heck, I’m still trying to figure out the details, but that’s what I’ve observed for now.
All the best.

3

Obviously we don’t think its impossible. If we thought that, we would invest in a different vehicle. The same is true for starting a new business, of which %90+ fail within the first year. It doesn’t mean that no one should start a business. However expectations should be tamed (especially for a n00b), so they don’t waste their time and effort for nothing.

Quick question. What makes the closing of the London session so special (it has its own acronym?!?!). I understand the overlap between London and NewYork is great for liquidity, but that lasts 4 hours and isn’t only at the closing time, its half the session.

4

That video is the funniest thing I’ve seen for a while. What does that guy think he’s doing at 0:50? :smiley: I thought he was having some sort of seizure at first. And the terrible acting from 1:35… it’s “awesome dude”. Hahaha. Pure comedy genius.

5

This is just all fluff, like “always trade more than 1:2 risk:reward” or “95% of traders lose” or “only risk 2%”. How can anyone categorically say “all strategies won’t work forever”? Have they tested every method in existence? It’s nonsense. There are probably quite a few forex millionaires out there, just like in any other trading arena. What makes Timmy special is that he has excellent showmanship and a cool story behind his wealth. It’s not penny stocks per se. And I’m not sure if Timmy teaches one strategy. I seem to remember him saying that he also buys penny stocks during the initial “pump” phase, or at least that’s possible.

6

95% of traders lose is not fluff, it is not an opinion, it is not a theory, it is not a guess.

95% of traders do lose. Cold, hard, statistical fact!

But I do agree with the rest of your sentiment.

7

I believe someone knocked that theory down in some of the threads here…in reality more than 50,60% of traders are profitable…

8

Well, I don’t know how he managed to knock down a “theory” in a thread. This requires quite a bit of data. The original statistic was done by looking at the books of many brokers (all in the US). I doubt that thread had that level of data, even from a secondary source.

Although it might sound frightening, its not THAT bad, because a big proportion of the 95% are those complete first timers who open an account with the min deposit and use max leverage and then die off. They never understood Forex, never tried to study it, never been pip school, etc… In equities that number is lower, because the complex alternative investments have a high barrier to entry for new investors. Also leverage is very limited and expensive in equities. Conversely, in Forex we don’t have bluechips.

9

Here are those threads:

http://forums.babypips.com/newbie-island/49292-95-forex-traders-lose-money-myth-fact.html

http://forums.babypips.com/forextown/59516-95-traders-loosers-myth.html

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From your links. This echoes my point:

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It may be a cheesy video but the fact of the matter is that they both have the life you desire to have from trading. And if you still don’t believe its true here are some more links to validate your unbelief.

Strategies for investing in penny stocks | On Air Videos | Fox Business

12

I myself do not trade the London Close but its something about that trading session that Shirley Hudson sees.

One of the things that makes me believe that strategy works so well is the fact that she is trading the set up at the same exact time every single day. And the psychological benefit of that i s that she is looking for the same set up every single day which increases her accuracy of that strategy.

And she has been doing this since 2010 so I guess this is one strategy that has been consistent over time. 94$ according to her spreadsheet.

13

I’ve only heard bad things about penny stocks. You’re betting on a loosing business. If you own 100,000 shares that are worth $1000 you may not be able to sell them all “if” the price goes up.

There is a reason the prices go down so low…

14

Investors tend to punt on medium term so that penny can gain over. And there are some penny stocks may also be on a long term depend on the company value. for complete knowledge need to understand all about UK stock market news and research.

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they understand the proper use of each and every single tool in depth. not just “Ahhhss~! This someone and this website taught me about this.” simply mix & match then come out with their lucky buy lucky sell strategy.

even for risk management, it’s not so simple as to “risk no more than 2% per trade”.

Professionals can only make a certain %% due to large fund of millions/billions have a threshold on multiplying. while retail traders are able to 2x,3x or even 10x due to their small capital.

“60-80% accuracy is impossible” is just a reverse psychology from someone who is trying to sell something to the natives. indirectly saying that they have something which doesnt require high amount of accuracy in order for you to profit off the market.

profitable traders dont need millions of strategy. They have the knowledge & understanding before applying anything.

16

Since 50 years this pink sheets crap is spooking around on the grounds among uneducated “traders”

Its so old that there were scandals about it

Storries

Books

And even movies

And whoever today runs around even says the word penny stock is as fit for “trading” as a pinguin without a computer and wifi

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17

I realize now that this WAS a corpse thread. But the above is hilarious!!! LOL!!!

Yeh. Penny Stocks. “Pump and dump” comes to mind!!!

Given that the OP was last seen some years ago I’m assuming things didn’t quite pan out.

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