MoneyTec 2.0 - Online Forex Traders & Brokers Social Networking Community » Trading Talk » Money & Risk Management

[comingback]

This section (MM) seems to be the least popular section on moneytec. Look at the amount of stuff on systems.

[mrbrint]

Yeah Id think it best to create my own system.

[TrendsFX]

i am agree with u also

[jemmy]

i think the reason why most people lose money is because they don't have enough experience in trading ,,, the first thing they have to do is to try demo trading first till they feel that they are in control of trading then they can open live accounts .
http://forexforumnow.com/index.php?P...12&topic=232.0

[Dox]

Hi folks! About beginers, same as me, there is many reasons we suck... Even i know all that stuf about money menegment, risk,disciplin, i still suck... I lose few demo accounts, and just can`t get true what a f. is going on! Same conditions, in one day make profit for me, next day - i`m losing... I tray diferent indicators even EA, but soon realise, its all wrong... I cant still make my own system. Just i thought - i did it!, in next moment i`m realising i was wrong. Now i try understand where the market is going, then figure out paterns, almoust using no indicators at all. I have no idea, will it gona work, or i`ll gona suck again! If there is somebody, in my shoue, let me know , how to find way out of this dark foreast! my e-mail - Hanza@tvnet.lv
Thanks.

[tdemolder]

People pay too much attention on the short time frame.. intraday trading.. it is the most difficult... Alot of noise.. few trend.

Too much attention paid to entries.... nothing much on exits and even less on money management techniques.

Not enough time spend on research...

you need to create your own system.. which match you personality as well.

For me.. I like trend following because that s the way I see the market. Once i got a trend... I let it run and add position all the way up until i got stop by my hard stop or my 3 differents trailing stops.

As a trendfollower I know that I iwll be right about 35/45% of the time on average...I build up my system hard stop and trailing stop in function of that.

I also have take in account the volatility of the market if the volatility increase.. your risk increase.. so I have set up a maximum risk per pair and also per sector...

Do not forget to trend follow you need diversification.... and preferable uncorrelated underlying... to decrease volatility and drawdown.

[pinalli]

Common mistakes newer (and some seasoned) forex traders make that cause them to lose money. Some of them are:

1. Get Rich Quick mentality. You have probably seen the late night infomercials about how easy and profitable it is to trade forex. Well, it is easy to actually trade, but difficult to trade well. Opening an funding an account can take as little as 24 hours and you can be up and trading.

2. Trading for the wrong reasons. Yes, there is a high associated with making a huge profit from one trade. However, do not treat forex trading like a day at the race track. You should not trade for the excitement of trading.

3. Not using a stop loss. This is where emotion comes into play. You should have a clear exit strategy when you enter a trade. Decide how many pips you are looking for and what your loss limit will be. If it is 50 pips, set your stop loss so that you are automatically triggered out of the trade when that many pips are lost.

4. Jumping from strategy to strategy. Strategies take time to develop and time to personalize to your own trading style. That is why a demo account is important to practice. Once you have learned your strategy and how to adapt it to changing conditions - stick with it! New traders will sometimes bounce from one person's strategy to another, without giving any of them a chance to develop. One bad trade does not a bad strategy make.

5. Emotional involvement in your trades. Turning off your emotions is a critical tool in trading forex successfully. Not just the down emotions, but the up emotions as well. Have a strategy to get in and out of trades. Resist the impulse to trade, feeling like you are on a wave of good luck. And conversely - don't keep trading if you are down out of desperation.


Following these tips will help you be part of the 5% of successful traders out there, rather than the majority that do not succeed.

[pinalli]

Common mistakes newer (and some seasoned) forex traders make that cause them to lose money. Some of them are:

1. Get Rich Quick mentality. You have probably seen the late night infomercials about how easy and profitable it is to trade forex. Well, it is easy to actually trade, but difficult to trade well. Opening an funding an account can take as little as 24 hours and you can be up and trading.

2. Trading for the wrong reasons. Yes, there is a high associated with making a huge profit from one trade. However, do not treat forex trading like a day at the race track. You should not trade for the excitement of trading.

3. Not using a stop loss. This is where emotion comes into play. You should have a clear exit strategy when you enter a trade. Decide how many pips you are looking for and what your loss limit will be. If it is 50 pips, set your stop loss so that you are automatically triggered out of the trade when that many pips are lost.

4. Jumping from strategy to strategy. Strategies take time to develop and time to personalize to your own trading style. That is why a demo account is important to practice. Once you have learned your strategy and how to adapt it to changing conditions - stick with it! New traders will sometimes bounce from one person's strategy to another, without giving any of them a chance to develop. One bad trade does not a bad strategy make.

5. Emotional involvement in your trades. Turning off your emotions is a critical tool in trading forex successfully. Not just the down emotions, but the up emotions as well. Have a strategy to get in and out of trades. Resist the impulse to trade, feeling like you are on a wave of good luck. And conversely - don't keep trading if you are down out of desperation.


Following these tips will help you be part of the 5% of successful traders out there, rather than the majority that do not succeed.

[pinalli]

Common mistakes newer (and some seasoned) forex traders make that cause them to lose money. Some of them are:

1. Get Rich Quick mentality. You have probably seen the late night infomercials about how easy and profitable it is to trade forex. Well, it is easy to actually trade, but difficult to trade well. Opening an funding an account can take as little as 24 hours and you can be up and trading.

2. Trading for the wrong reasons. Yes, there is a high associated with making a huge profit from one trade. However, do not treat forex trading like a day at the race track. You should not trade for the excitement of trading.

3. Not using a stop loss. This is where emotion comes into play. You should have a clear exit strategy when you enter a trade. Decide how many pips you are looking for and what your loss limit will be. If it is 50 pips, set your stop loss so that you are automatically triggered out of the trade when that many pips are lost.

4. Jumping from strategy to strategy. Strategies take time to develop and time to personalize to your own trading style. That is why a demo account is important to practice. Once you have learned your strategy and how to adapt it to changing conditions - stick with it! New traders will sometimes bounce from one person's strategy to another, without giving any of them a chance to develop. One bad trade does not a bad strategy make.

5. Emotional involvement in your trades. Turning off your emotions is a critical tool in trading forex successfully. Not just the down emotions, but the up emotions as well. Have a strategy to get in and out of trades. Resist the impulse to trade, feeling like you are on a wave of good luck. And conversely - don't keep trading if you are down out of desperation.


Following these tips will help you be part of the 5% of successful traders out there, rather than the majority that do not succeed.

[pinalli]

Hi there...



This has been the quietest weekend in recent memory with no new major policy initiative officialdom needed to prop up the failing institution or systemic crisis du jour. The US equity market close looked rather weak on Friday after a buying spree sparked by William Buffett's announcement that he is buying stocks but the Asian session this Monday opened on a positive note. The stard risk appetite indicators elsewhere are sending mixed signals: interbank lending measures showed a large drop on Friday the shortest US t-bills showed a rise in yields but credits spreads on companies were still stretching wider on Friday worries over corporate defaults remain very high. In currencies the JPY was weaker overnight AUD was stronger the USD has hardly done anything since Wednesday of last week. Some of the panic pricing in EM - though still within recent "ranges".
An article in Bloomberg this morning points out that corporate default worries may be too high that a buyer of a diversified basket of high risk corporate debt would need for almost all companies to go bankrupt to not get their money back on the investment (if historical recovery rates on default are still the case). So clearly a lot of worry has been priced into this market yet few are willing to call a bottom as liquidation pressures hedge funds possible mutual funds looking to raise cash for redemptions may offset any investors who have enough funds to take advantage of perceived bargain prices.

[jeff15]

One of the major reasons is the gambling attitude people tend to adopt. Forex begins yeilding consistent returns only when you have been there for long enough.

[jeff15]

Originally Posted by pinalli

4. Jumping strategy to strategy. Strategies take time to develop time to personalize to your own trading style. That is why a demo account is important to practice. Once you have learned your strategy how to adapt it to changing conditions - stick with it! New traders will sometimes bounce one person's strategy to another without giving any of them a chance to develop. One bad trade does not a bad strategy make.

By all means. With 2 years in trading I am only beginning to learn that "sticking" with strategy is as imp as formulating it.

PS: anyone out there?the forum seems to quiet more than usual.

[brianlav]

Jeff, you are saying two years. Is it the amount of time it took you to get your strategy right ?
As I am in the process of killing my second demo account, I am more on a cautious timeframe and quite willing to go the cautious strategy way. Just curious how much time for a newcomer before being able to trade on forex and not lose everything

[pinalli]

Originally Posted by jeff15

By all means. With 2 years in trading I am only beginning to learn that "sticking" with strategy is as imp as formulating it.

PS: anyone out there?the forum seems to quiet more than usual.

Yes obviously jeff thats why it s counted in common mistakes of traders.

Regards

[DarenPowell]

I cant still make my own system. Just i thought - i did it!, in next moment i`m realising i was wrong. Now i try understand where the market is going, then figure out paterns, almoust using no indicators at all. I have no idea, will it gona work, or i`ll gona suck again!