analyst75 Posted March 22, 2017 Share Posted March 22, 2017 One of the frustrating things about being a trend follower is that it takes time to overcome the inertia of a new system, particularly if that system is based upon slightly longer time periods such as weekly data. Part of the frustration that traders encounter is based upon the simple mechanics of how systems work. A system that is correctly designed takes its losses quickly and allows its profitable trades to simply roll along. This results in the system instantly going into drawdown and it is this drawdown that causes traders to develop friction with their system. This friction often leads to tinkering as they attempt to force the system to give them something it cannot give. This is exacerbated in times of a flat market – you cannot force returns from a market. The All Ords of late has not really been a stand out performer as can be seen from the chart below the market has been slowly grinding its way up in a broad channel. With this in mind I thought I would look at the yearly returns for the various stocks within the All Ords – so I found some data on their percentage returns and stuck it into a frequency histogram to see what the performance of individual stocks looked like. Please visit this link for the charts and images that come with this article: http://tradinggame.com.au/where-is-the-money/?utm_source=Blog+Subscribers&utm_campaign=2e70d91994-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_eb90516269-2e70d91994-43344013 I have a arranged the data into a serious of blocks and did a count of the number that fell into that category. I also calculated the average performance of the group which for this period stood at 17.09%. However, if I drop out the 200% and above outliers this average value falls to 13.04%. As you might have guessed the majority of values cluster around the mean with a long right handed tail. This sort of distribution is common with stocks since we have unlimited upside but limited downside – a stock cannot decline more than 100%. Our psychology dictates that we are instantly drawn to the right hand side of the chart and the extreme outliers that occurred over the past year. And as traders these are the sort of trades that we hope ours might evolve into. However, in doing so we ignore that left hand side of the chart. The majority of stocks (60%) have below average performance. You may assume as a trend follower that this is not an issue since you would avoid these large losses and poor performance by the use of stops but that ignores the reality of the actual trading process. As a mechanical trader you will not incur these losses but you will burn time wading through these non performing stocks before you hit the ones that do perform. You waste time, a little bit of money and a lot of patience dealing with this mediocre performance. My anecdotal experience has been that trading returns are made up of a lot of modest returns and a tiny handful of trades that do very well but to get to the ones that do very well you have to crank through a reasonable number of trades and you have to keep going. This is where the notion of emotional resilience comes into its own in trading and the ability not to tinker with the system hoping that it will generate these sorts of trades. Systems don’t actually generate these sorts of trades – the market does so you cannot actually build a system with the preconceived notion that it will find you trades that generate a 500% return. What the system does do is generate a population of trades, most of which will be duds and hopefully a few large winners. But in the beginning all trades look the same. Author: Chris Tate Article reproduced with kind permission of Tradingggame.com.au More helpful quotes from professional traders are added below: “As always the battle is not with the market but with yourself.” – Chris Tate “Get any group of traders together and you will notice that the novices tend to talk about indicators and charting patterns, whilst the professionals discuss trading psychology and money management. In the beginning, you’ll underestimate the importance of these two key areas.” – Louise Bedford “Most people have an “interest” in becoming consistently profitable traders. However, few possess the essential ingredient of “total commitment.” Total commitment is what is demanded for a high level of success from any endeavor. A trader with commitment will take the money away from 100 traders who have only an "interest.” – Joe Ross “In fact I would say trading without a stop is like walking a tight rope without a net. You should always place a stop, not because you expect the market to go against you, but to protect against the unexpected. The worst losses I've seen have resulted from a trader not having a stop order in place and the ensuing deer-in-the-headlights paralysis that sets in once losses start to mount.” – Andy Jordan www.tallinex.com wants you to become a successful trader Quote Link to comment Share on other sites More sharing options...
Anne Morris Posted May 8, 2017 Share Posted May 8, 2017 Forex is a sort of business where you can make massive money with quite ease, but for all this we need to make sure we work with proper way. I am currently trading under OctaFX and with them; it’s ever easy by all means with having small spreads at 0.1 pips, high leverage up to 1.500 while there is cash back where I get up to 50% and that too on losing trades as well. I feel entirely comfortable and relaxed with things here under them. Quote Link to comment Share on other sites More sharing options...
radex78 Posted May 13, 2017 Share Posted May 13, 2017 Forex business is included as risky business and here indeed on daily trading there are money on billion dolar circulating on forex market and because difference volume transaction that occur on the market making changed price movement and as trader trying catch opportunity to making profit Quote Link to comment Share on other sites More sharing options...
gaban Posted May 16, 2017 Share Posted May 16, 2017 Forex business is included as risky business and here indeed on daily trading there are money on billion dolar circulating on forex market and because difference volume transaction that occur on the market making changed price movement and as trader trying catch opportunity to making profit In getting the opportunity to be able to generate profits in the course of trading that we try to always run in learning, because with us run with preparation and readiness in forex executed will be more opportunities we can get for profit obtained consistently Quote Link to comment Share on other sites More sharing options...
bearhugs Posted May 19, 2017 Share Posted May 19, 2017 Forex is risky business but once you learn it. You can make any amount with your mind and can be successful. All depends on you and your skills that how you manage your trade with market. Quote Link to comment Share on other sites More sharing options...
radex78 Posted May 20, 2017 Share Posted May 20, 2017 Forex is risky business but once you learn it. You can make any amount with your mind and can be successful. All depends on you and your skills that how you manage your trade with market. Although forex as risky business but in fact still many trader interested with this business because forex also still promising as one great source of income, but indeed required good knowledge and experience on this arena because will difficult if trading forex only relying with lucky on trading Quote Link to comment Share on other sites More sharing options...
aliforex Posted May 22, 2017 Share Posted May 22, 2017 Although forex as risky business but in fact still many trader interested with this business because forex also still promising as one great source of income, but indeed required good knowledge and experience on this arena because will difficult if trading forex only relying with lucky on trading All that is already there, because it is with us can master it well it will be very easy, so for traders should learn more and understand correctly, and continue to discipline Quote Link to comment Share on other sites More sharing options...
bearhugs Posted June 10, 2017 Share Posted June 10, 2017 Discipline with your work can make a huge difference in your trading and earn too. Being regular and planned is always make us well maintained and that can help us to focus on our trading too. To be profitable, we need to learn a lot of things in life. Quote Link to comment Share on other sites More sharing options...
aliforex Posted June 15, 2017 Share Posted June 15, 2017 Discipline with your work can make a huge difference in your trading and earn too. Being regular and planned is always make us well maintained and that can help us to focus on our trading too. To be profitable, we need to learn a lot of things in life. So it must be from the bottom and from the ability and understanding well, and to be able to master the workings and make profits easily, then we must really learn best to be able to maximize his ability and effort properly Quote Link to comment Share on other sites More sharing options...
Gee Dee Posted May 15, 2018 Share Posted May 15, 2018 Forex being an over the counter market is providing earning opportunities to millions of traders today. Traders sometimes may think from where they are able to earn money and what is the process? The basic concept is to buy currency at low price and sell currency at the high price and try to get profit from the price fluctuations of different currencies. We are trying to make our investment in currencies here but not all currency pairs are appropriate for us. We should determine which currency pairs are best for our trading journeys. Quote Link to comment Share on other sites More sharing options...
michel Posted May 16, 2018 Share Posted May 16, 2018 Where is the money? Go world-bank and check there! Quote Link to comment Share on other sites More sharing options...
SusanaP Posted May 17, 2018 Share Posted May 17, 2018 I think that, Forex business is included as risky business and here indeed on daily trading there are money on billion dolar circulating on forex market and because difference volume transaction, however I can trade in pairs as dkk to dollar with good earnings Quote Link to comment Share on other sites More sharing options...
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