/biz/ - Business & Finance

>>10874562
>seems narrow but deep
What

>>10874589

The basic theory. It's just buy low sell high on currency pairs. Really only one number to look at I mean.

The shorting and keeping up the with market trends is what makes it so difficult though for most.

The problem for most hobby traders is brokerage fees. Once upon a time i thought about going with Learn2Trade because they streamline this whole process for you, but i got real scammy vibes off them and realised they impose strict trading rules on their traders as a way of controlling reputation.

Meh. Id rather just put $X in an index fund and 20% of x in longshot options.

to operate on more than a gay meme trading strategy (these are all negative ev btw) you have to understand and process a lot of fundamental information re:international trade in competition with multi billion dollar supercomputers that have instantaneous access to all pertinent information. it's a trap for fearful boomers who realized that they are worthless too late in life to do anything about it.

>>10874562
all trading is for suckers. the real players have equipment and resources that put them at too much of an advantage

>>10874683
How does following the big guys not get you rich exactly? You're technically following the economy...

>muh supercomputers will predict a collapse before this puny human can gather all the information in time
Sure, AI is nice and all, but they're only limited.
If you think all they do is turn on a machine and let it rip, then you are mistaken.
They need to re-tweak the software constantly or risk losing all their money

>>10874991

So is scalping or daytrading viable as opposed to the Soros long-con currency manipulation?

>>10874562
Ignore people who say it's impossible. It's difficult, but this is not fucking Rocket Science.

General reasons as to why I believe the majority Retail Traders will fail. I've been looking into a lot of threads on r/Forex, and this is coming from my own experience, actively trading for over a year now.

1. Retail traders are generally under capitalized. Most will struggle find even a couple grand of whatever currency, in order to trade with. What this leads to is position sizing which is too large. This is done with the intention of building the account up to a larger size, in small amount of time. I completely understand the mentality. But that's where you're not actually trading, you're gambling and hoping to somehow get lucky on a big win. And like anything, some people end up getting lucky. The majority don't, and they end up becoming part of the 80%, or so, who end up losing. I'd advise you to start with at least several thousand units of whatever currency you're dealing in.

If you're dealing with leverage of around 500:1 (although things with ESMA have caused some changes to leverage in Europe, and so you either need to find an Aussie broker, or start with even more Equity in your account), you'll want to allocating no more than 5% of your Equity to each position, when you're starting off. General rules of thumb are to have stops of around 1-2% Risk per position. And I'd advise trading higher time frames, when you first start.

As you can tell, by following these risk management steps, you're probably not going to be talking position sizes larger than the Mini-lot size, if you have an Account Value starting off with a couple thousand. Trading is not ever going be easy/quick money. You can build wealth through it, but it takes time to compound an Account into something meaningful, and to build your experience/methodology.

2. We tend to take profit too quickly, and we tend to hold to losses for too long.....Continuing next post....

>>10875384
I follow mostly so far.

I am a total n00b who last took an economics class in HS with a low paying normie job but I am conservative with money and want options to learn. (not limited to just FX)

Should I start with practice accounts for a while first while I follow a strategy?

>>10875384
2. Continuing: Ideally you want to have set ups which have a good Risk to Reward, but again, this is all Methodology dependent. But one general mantra you can use is "Cut losers. Add to Winners". This approach is most suitable to Trend Trading. Forex tends to produce a lot of good trends, because there's so many currency pairs and Fundamentals going on in the world. And there are many time frames upon which Trends occur.

3. This really applies to myself, when I first began (and I still struggle with it), but I think it's the same for a lot of other people too. We try too often to find Tops and Bottoms - i.e. play Mean Reversion. This is actually really difficult to do, imo, when you're first starting. Trend trading is not easy, but it's relatively easier to form strategy around (in the right Market Conditions) than Mean Reversion. Again, there will be people who disagree with me on that, but that's coming from my experience.

Have a look at places like r/Forex, lots of good discussion there.

Some good youtube channels:

https://www.youtube.com/user/tradingwithrayner

He'll get you started with how to trade Support/Resistance/Trends/Mutiple Time frames

https://www.youtube.com/user/ukspreadbetting

Really good general trading videos on here abut Risk Management and Psychology, and general approaches. In fact, watch this video Mark recently posted on whether or not Forex is a scam: https://www.youtube.com/watch?v=IAUALJy-5w8

Find some website that provides and economic calendar and commentary, stuff like FXstreet and investing.com

If I come up with more reasons as to why people fail at trading I'll post more.

>>10875384
>General reasons as to why I believe the majority Retail Traders will fail
the majority of traders don't fail to make money, they fail to beat the average return. By definition the majority of people don't people the average.
and the benchmark for a successful trader isn't knowing enough. it's knowing more than everybody else; you're not racing against a clock, your racing against other people. everybody is trying to claw their way to the front, and the front runners pretty much always get there with the support of a team and lots of money.

>>10875442
Absolutely start with a Demo. Also recognise that your psychology trading money which is not real will be completely different to trading actual money. You're going to be taking more risks in your demo account that you won't with real money. Make sure to account for that in your demo performance.

>>10875491
You sound like someone who hasn't traded, and so until you do so, you're not going to have any opinion or point of view on anything that's meaningful. You're probably going to get pissed off by me saying that, but it's just reality.

>>10875506
you don't need to frequent the casino to know that the slots are a bad bet.

>>10875552
The only thing Trading has in common with a casino is the uncertainty (to an extent).

The very important difference in Trading is that the Trader is in complete control of how big His or Her losses are. You don't often get that in situations a casino provides.

>>10875575
*losses or wins are

>>10875575
poker then. even if you take out the house's cut, the majority of people lose money. in terms of beating the market, it's a zero sum game; someone's win is someone else's loss.

>>10875506
>>10875575
post a screen of your most recent 50 trades and account balance or fuck off.

>>10875607
Yes, poker can allow you to determine your wins and losses, and trading is zero sum.

But that's the only similarities it has to trading, everything else, in terms of approach is different. For example: In poker, when you win whatever share of the pot, you can't ask for more from other players. That would be the equivalent of what you're doing when you add into a winning Trend position.

And even the zero sum nature of trading is a lot more complex. While someone might be losing to another trader, on a smaller time frame, they could end up winning on a longer time frame. There are differences in what Market Participants are trying to achieve, they all have differing time horizons.

>>10875619
It's fine, I'm lying, don't believe me. I don't know what I'm talking about.

>>10875660
the zero sum game is played entirely by investment banks and funds. the everyday retail trader has no more than a 50/50 chance of coming out ahead. I'm sure the minority of people who manage to keep their head above water tell themselves that it due to their own genius (see https://en.wikipedia.org/wiki/Attribution_bias)), but they're working with information that's at best full seconds too old to be relevant. it's basically entering a car race on a bicycle.

>>10875727
that should be https://en.wikipedia.org/wiki/Fundamental_attribution_error

>>10875384
> I've been looking into a lot of threads on r/Forex
> coming from my own experience, actively trading for over a year now.

How is this related to chainlink?

>>10875727
If you believe that, without any sort of experience in Trading, then that's fair enough. I'm not going to encourage anyone to change their view. If someone asks for help, I'll try point them in the right direction, and explain to them the dangers most people will fall into.

Fact is, nobody is going to outperform an index in the long run by just buying and holding a bunch of Large cap stocks. This is because of how the Stock Market moves, in relation to the Futures markets.

Institutions use what is essentially Cash and Carry/Reverse Cash and Carry Arbitrage to take advantage of discrepancies that arise between Futures Markets and Index ETFs: https://www.investopedia.com/terms/i/indexarbitrage.asp, and so, in the long run, Buy and Hold will most likely result in an approximation of Index Returns.

People can choose to be more Systematic about how they exit and enter, if they wish. And they may find that what Academia thinks is fact, is actually not always the case.

>>10875384
I've got a position size of about 200k and there's an extremely volatile currency pair (KRW/USD) I've had my eyes on trading for over a year. I shouldn't need any leverage, at all.

Will that make things way easier for me? I've noticed that some of these more volstile currency pairs are extremely predictable and don't really need any leverage at all. 1% a month for me is still like 24k a year so I'm fine.
Should I unironically pursue this? I've spent the last year trading crypto.

>>10875784
>If you believe that, without any sort of experience in Trading
believe what? you haven't refuted any of what I've said. to reiterate, yeah, the big players control the market, but there's no way for the retail trader to take advantage of that.
you're wasting your time and money if you think that with enough experience some kind of magic finance muscle in your brain will eventually start churning out perfectly timed trades from your home computer.

>>10875813
Start with 10:1 leverage or trade smaller position sizes. Definitely try a demo account first.

Alternatively, when you start, don't deploy all of your equity (just use more leverage instead). And learn with that beginning amount.

>>10875851
I would encourage you to try demo trading. Actually give Technical trading a proper run for at least a month. When you see how Markets respond to things like Moving Averages, you'll realize that you can form a plan to make money off of the trends that occur.

Or maybe you prefer order book trading. Stuff like Market Maker Scalping using Correlated Markets and the strategic use of Queue mechanisms in the Order Book. HFT actually hasn't removed all human based Market Making strategies (as I once assumed).

I don't want to say how I've done with my trading (if that were to persuade you), because I'll get 2 responses:

1. Disbelief from people who hold so much faith in the inability to beat index returns.

2. Other far better traders probably just seeing my performance as being absolutely horrific. There are traders to whom return %'s are meaningless because they literally just use markets to generate income.

Just give demo trading a shot, and you'll realize that, while it's not easy, The Market isn't something which is impossible to understand.

>>10875990
damn, go easy on the shilling. you're sounding as bad as a pyramid scheme recruiter. probably not by coincidence, hitting too many of the same notes
>you can be rich in months, just like me
>you just have to work hard and believe in yourself
>just open your wallet and start putting in money until it comes back to you in droves

also I didn't say retail investors couldn't beat the index. I said the chances of doing so were 50/50. which is a waste of time in the long run.

>>10876095
Okay. Then I'll reiterate that Trading is not easy money. Just like most businesses fail (many doing so because they're under-captilized ), and like how it's tough to be good in literally any profession, that's ever existed, Trading is no different.

It should be treated as a business, a profession. Not some get rich quick, easy money, path out of poverty. It will take time. And even then, success is not guaranteed.

Nice dutch war / trade ship OP.

You need more VOC mentality, try to sell opium to the chinese or someshit idgaf

>anon in Amsterdam
>disgusted by all the drunks and druggies everywhere
>"I know, I'll go see the VOC headquarters"
>beautiful building now a shitty apartment

MFW

>>10875913
I was hoping to go with no leverage at first though, not unlike what I've been doing in crypto for 2 years. Wouldn't it be safer to just trade these volatile Forex pairs with no leverage at all??

>>10876505
You certainly don't need to use any if you're not comfortable with doing so, and you're right, it's probably best to avoid using on a low liquidity/highly volatile pair.

That was just a suggestion as to how you could potentially approach incorporating leverage, if you wanted to.

>>10876505
Hell yeah brother

>>10876402
toch?!

>>10876441

My entire country (netherlands) is a giant JUST

Mercy-kill us