Why do Newbies Lose? - Page 3
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Thread: Why do Newbies Lose?

  1. #21
    Some of the huge reasons would be:

    undercapitalised

    poor system

    lack of patience to implement system properly

    . .and simply a lack of experience. It takes some time to understand how to do anything properly.

  2. #22
    Im a noob myself, but since I have put in a year and a half to prepare for this, I'll have a shot.

    1. Lack of a trading plan

    Ex: Trader A once asked about his plan, replies 'I buy that the pinbar everytime that the RSI is overbought and the trend is upward', well that is not a plan.

    Trader B might list out the overall market conditions that need to be in place for his system to spend the trade, and there could be two setup conditions, an entry trigger, a methodology of quantifying risk on the trade (which means setting stops), a multiple lot trade management that manges his exits, along with a position sizing algorithm that may equipment sizing according to his objectives and tolerance for risk. All this is then blended with actually how much capital out of his equity will he optimally devote to the system (keeping its P/L in mind both forward and backtested). This could be the outline of a plan, think of it like a pilots test record.

    2. Lack of accurate or timely record keeping

    Different means of doing so. But lets go to Trader A again, whose idea of record keeping might be the system he's using, his R :R details and the final outcome.

    On the other hand Trader B, goes through his trading plan checklist, basically filling in the values to get his system on rather a preexisting kind of types, takes a minute to write his private feelings (feelings) and standard plan of action (which his plan should indie, but that is a summary of words), and all this prior to the trade. He also requires a snap of the charts (about 3 or 4 per trade), after before, after during and one on departure. He then prints the charts and then sticks it into a binder together with his recordings for that particular trade and his private view (if any) before, during and after the trade. He might even go a step further and track the particular market where the trade had been shot, a day later departing and record this chart also and his outside take (giving him an objective perspective of both his entry and exit).

    At the close of the week it's the journal that will tell him how many 'great' trades he created. A 'great' trade being where he followed his plan, along with a 'poor' one being he did not. Wins or losses are somewhat immaterial. Since the trader plays a positive edge, the entire battle is putting on your trades at a planned and proper fashion, the cash will look after itself, just book 'great' trades. At this time he might select a few trades to revisit at a later stage (possibly monthly or quarterly system inspection).

    This is not easy work, you are going to have thick binders of hands written documents (or gigs of word and excel whatever). Say you do 100 trades a month (that is subjective a lot), thats 40 hours of paperwork for the month. Yes, just like cops and ceo's, we also have grunt work to finish every day/week/month over and over again. This paperwork is indispensable and can't be achieved without, period.

    3. Overtrading - Moving up a time frame or two helps, but if you follow step 1 and 2, 3 will look after itself, lol.

    4. Incorrect position dimensions

    Here is a thought, if you're a professional card counter in blackjack, well then you're knowledgeable about the fact that there is time once the player actually has an edge over the house. Well if he still stakes more than ideal size, he could and will go broke, it doesn't matter how great or large (in reason) the edge itself is.
    It should be noted that if he stakes less then the best dimensions, has a better prospect of becoming profitable (a route that a lot of experts take), but will end up with less cash. This is an acceptable trade off to experts, actually the lower you get in position dimensions, the higher probability that you will earn money (provided you have an edge). So individuals choose their spot on the scale in accore with their personal preferences and objectives (utility).
    Matter of fact if you don't have a border whatsoever and neither did the casino (the market), absolutely 0 ev for both, you will still go broke if playing an unlimited bankroll. So err to the side of conservatism and bet low, until it is possible to measure your edge properly ( a large problem, to ascertain optimal f). The one thing newbies dont.
    Matter of fact when every new trader only bet 1% each trade, edge or no edge, plan or no plan, journal be damned, he would take soo long to dismiss his acct, that he would learn 'the trade' while shedding. Incorrect lots is astrophic, more then any other single element.

    All these are my primary 4 motives. Just as a final note, they say 'the system is that you', referring to trader plogy being supreme in this industry, and I concur, since it requires a lot of plogical fortitude to continue to fill this damn journal and go through this checklist, trade after trade, day after day while you're going through a three month drawdown. And the tendency to never lose attention and risk 10% on the next trade to 'draw level' is one that lots of mortals can't resist.

    People who may turn into legends. This is a hard business, not only for newbies either.

  3. #23
    Quote Originally Posted by ;
    quote And no one could show evidence of that... And nobody could take my wager... Guess why? I have been involved in the investment industry (serious investment of REAL THINGS, not TIN AIR like FOREX) for at least 15 years (Not long enough tho), and I will tell you I have understood REAL STOCK TRADERS and I have visited several occasions the STOCK MARKET in my city, and I will inform you that the exact same STOCK BROKERS told me the facts about FOREX. I really saw the fact, but it is always great to see people with 30 years of experience in the FIELD, telling...
    I am able to bring in 5 to 20 percent each month since one year and I feel no problem with it do not know about others , so your claim isn't legitimate.
    Yes it demand risk of loosing money but know it and its OK for me if I lose.

    I do stocks major difference is flexibility and liquidity in Forex and stock scripts.

  4. #24
    Quote Originally Posted by ;
    quote that I am able to bring in 5 to 20 % per month since one year and I believe no issue with it don't know about other people , so your claim is not valid. Yes it involve risk of loosing money but know it and its OK for me if I shed. In addition, I do stocks major distinction is bandwidth and flexibility in Forex and inventory scripts.
    Can you create a living EXCLUSIVELY from TRADING RETAIL FOREX from your House with a U$ 100,000 LIVE account?

    The answer is NO...

    Can you have a standard or even a mini account? (OR MICRO) ? ... Well, you don't need to answer that one, most of us know the solution.

    And think, even thou you are all enthused and motivated since you claim to get a couple of profitable quarters (if it is true at all) you will lose LONG TERM, NOBODY beats the HOUSE LONG TERM.

    Ciao.

  5. #25
    Quote Originally Posted by ;
    quote Do you Create a living EXCLUSIVELY from TRADING RETAIL FOREX from your HOME with a U$ 100,000 LIVE account? The solution is NO... Do you have a regular or a mini account? (OR MICRO) ? ... Well, you don't need to answer that one, most of us know the solution. And believe me, even thou you are enthusiastic and motivated since you claim to get a couple of profitable quarters (if it is accurate at all), you'll lose LONG TERM, NOBODY beats the HOUSE LONG TERM. Ciao.
    Well I would invite you to read about MM , if you believe no one can earn money from Forex then you have to adopt some other business like actual country.
    There are many companies who have great return ratios might be Forex is not for you ,Forex needs lot of patience and mind work.

  6. #26
    Quote Originally Posted by ;
    Well, as a newbie I spent a few months reading and trying to work out a way to understand how to trade. I mean I know how to open the account and place an order. I made it through numerous transactions with some profits and losses. I only see so complied charts and indiors. In addition, I see more complied news that I should follow to know if I need to sell or buy. The entire thing remains overpowering for me. I stopped trading for a few months simply to read. The longer I read, the more I believe so much lost. So, please give me an idea about how to become better....
    Do not discontinue trading , and get it done with accounts , keep your eyes open and you will see a lot of opportunities , to avoid huge losses keep lot size smallest possible.

  7. #27
    Quote Originally Posted by ;
    Well, as a newbie I spent a few months studying and attempting to figure out a way to learn how to exchange. I mean, I know how to open the account and place an order. I made it through numerous trades with a few profits and losses. I just see so complex charts and indiors. In addition, I see more complex news that I should follow to know if I need to sell or buy. The whole thing is still overwhelming for me. I stopped trading for a few months just to read. The longer I read, the more I believe so much lost. So, please give me an idea about how to become better....
    They do not say trade with the tendency for nothing

    after you can see the primary trend(s) - using two or one or a Couple of indiors
    then you will have the basis for a system

    the rest is just entrance / exit signals / SL and learning how to exchange around and on the major news
    in uptrends and downtrends
    and then find an Excellent broker

    that's all there is to trading - nothing else
    unless you want to exchange everything and everymove - then you are asking for trouble

  8. #28
    The reason that many newby traders fail appears to me is more than confidence and above simplifiion of the entire process. I mean when I was brand new I recall taking a look at charts and thinking.... It cant be that difficult... it could just go two waysI began to find $$$ signs and may see myself in only a brief amount of time sitting on my yacht together with my notebook living the fantasy. Of course this led to over trading and extreme risk taking which always led to devastating defeat. I thought I was intelligent enough that I need to trade with the tendency just like all the other wimps.... ha ha.... What a dip shit I had been. Another big one for me is not sticking with a winning egy once I found one. I would trade it for some time and then when I didnt magically triple my portfolio I would proceed on to the next one... and the next one... so on and so forth.

  9. #29
    Quote Originally Posted by ;
    Hi, Just wondering what exactly do newbies do to shed? I mean when you start a trade, irrespective of some analysis you do, you're issued a 50:50 chance of winning/losing, so how can you eliminate overtime? Well, I guess the first thing is trading price, each trade you make it will cost you around 3 pips, therefore when a newbie makes 100 transactions, 50 wins and 50 losses of equal dimensions, they will end up down 300 pips. I believe newbies have a tendency to make many many transactions in a brief period of time, the market rise a few pips and they buy, the market falls a few...
    One of the principal reason is lacking understanding about Forex trading and also next best one is covering initial shed.

  10. #30
    Quote Originally Posted by ;
    quote You cannot Forecast the Future. All indiors LAG big moment. FOREX is pure randomness. When you believe you won a trade, due to a James16 candle, it really was pure randomness, and next time it is possible to lose. The truth is that 99.6 percent of people lose long term. All said.
    You become what you think about half vacant. All you appear to say is that 99.6 percent of people are losers blah blah blah and we all recognize that indiors are lagging. There are successful traders out there who utilize trend lines and specific price action patterns and yes, we will all lose at some point but it's the amount you win once you win and the amount you lose once you lose that counts. Have you ever thought that some folks do make a living from trading. I know that it takes years and lots of cash to get there. A group of people could be shown exactly the exact same egy and a few will make money and some will not. Why is that ? It is because we need to find our niche, our very own egy that fits in with our character, risk and way of life. I am not giving up any time soon because believe it or not, I really like trading. The major attribute is PERSISTENCE and thinking in yourself and of course a good mentor.

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