hello people,
well,im a newbie here and in forex, im starting to larn about and i was wondering : where goes the money that we lose on forex?
sorry if is a silly/dumb question :o
To other people
To pay for my lifestyle. Thank you, its very much appreciated
so we win and the money comes from other people and we loose and the money goes to other people? is like if were a big bubble of money where some of then take and some of them give?
Isn’t it also true that some of the money are sort of ‘stolen’ from parties who are just exchanging currency for business purposes other than speculation?
I have yet to see a proper explanation of what exactly occurs when trades are made in forex, some say the broker is actually a bookmaker who stands to make the money you lose, others say all the broker does is place the trades and keep the spread, there must be a reason why it is so hard to find out what exactly happens and it is probably because it is something they would rather we all don’t know about.
People keep telling me that Forex is a zero sum game. To me, I really do not care. All I care about is growing my account steadily and living comfortably with the money I gained from trading. As my account keeps getting larger, I will invest the money I gained into real estates and other fixed income investments. As long as I’m not cheating anyone and forcing others to lose money, I’m happy. People lose money because they’re going against the market and I’m going with the market. But then I go against the market all the time 
Good luck!
It depends on the paradigm that the broker employs. A DD will take the opposite side of your trade. A NDD will try to match opposing trades, take opposing side of historically losing players, or they’ll send the order to their liquidity provider (interbank) to be hedged there. An STP or ECN broker sends your order to the interbank level.
to Curiousgirl:
Forex market is not only for speculation purposes, there are speculators, commercial hedgers, minor and central banks, and other business, even normal people make exchanges trought banks…
So, a lot of corporations and people do not really care of losing money in Forex because that’s not their business and they do not care, but speculators do care and we try to take advantage of that.
It somewhat depends on the broker, as someone else noted, but in the broadest sense, if you lose money, someone else has won it. If you win money, someone has lost it.
A broker may make a market, in which case they will attempt to match orders and simply hedge any discrepancy (i.e. They are net long on EUR/JPY because more people are buying than selling so they cant match all orders, so this would be hedged in the real market).
Other brokers will place your order into the real market.
However either way if you close by buying a position that equates to $1 per pip, there is not necessarily a person selling to you at $1 per pip, it is quite possible that it is a bank, a corporation, another individual etc. who is selling at $1000 per pip and your order is combined with many others in order to make the transaction. That’s a slight simplification but the point I make is that your order is not necessarily exactly matched with another individual.
Someone else also correctly noted that not all market participants are speculators, there are corporations hedging foreign operations risk, etc. and for them a minor loss is not an issue, but can translate to your gain.
A little too much paranoia here.
The issue is that the forex market is complex. You have dealers and brokers of several different types. You have a futures market. You have speculators, hedgers, and those who just need to swap one currency for another with no positional aspect to their involvement at all.
The only market where it is truly guaranteed zero sum (negative sum after transaction costs) is futures because every long must have a short on the other side. For the most part, it’s the same way in retail spot forex too. Either a broker or another trader is going to be on the other side of the trade.
Thanks gasanvill, great explanation 
Good answer. In most cases the broker will blindly take the other side of the transaction. Since most traders are losers the broker is the one whom keeps your losses. If you win, you take a very small piece from the broker.
Some of it goes to send my oldest daughter to Dental School. Thanks.