yes, that's exactly the way I see it. When it comes to brokers, you probably need a little better bullshit detector than you would in stocks or futures, but if you don't have a good bushit detector you shouldn't be trading anything. Last report I saw, 90% of forex trading is speculation, 10% hedging In big countries like USA or eurozone it may not mean much, but in smaller countries, exchanging currency is a common neccesity, so there are many small retail traders world wide active times in futues may not coincide with active times in spot, plus you are limited to set (125k) unit increments I've traded everything, now all I trade is forex exclusively with ib. But I had the luxury of starting out with just 25k positions. If I'd done what I did in futures I would have run out of money first before I started getting an idea how it works. otherwise, I was approached by a private equity firm that was looking for investors in a forex brokerage firm in the middle east. The numbers didn't look that good. Hard to make money on transactions. Then the slimeball smiled and said, "Most traders lose. We make money by taking the other side." My guess is, most traders who switch from ES to eur.usd bring all their problems with them and probably end up with the same results. I know I couldn't get away with in ES what I can get away with in forex. Especially putting on small positions and letting them run against you, and averaging down. Not to mention piling on to winners. A small forex account is very much like having a large stock account. You'll probably get better advice from Warren Buffet than you will from Market Wizards, when it comes to forex. ib gives me 40 to 1, and that is more than enough rope to hang myself.
says the man looking for dollars from Patak and then blew up I'm hardly undercapitalized and was just making a point about risk-control (cut back on your size when you're losing and ramp it up when you're winning). But that flew way over your head.
that's the point. You'll still have all the problems trading forex that you have with anything else, with the exception of undercapitalization. There is just no excuse for it in forex.
for instance, I've gone through periods when I couldn't hit the broad side of a barn. Everything I bought went down, and everything I sold went up. Sometimes the best thing to do is just hit the button and get flat. Get your head back together. Now you are sitting there with a smaller account than you started with. So you just start over, but all sizes are adjusted to your now smaller account.
Forex is totally a strategical business and it gives the traders full options to earn the maximum but we don't forget that this is also a high risk business, where we can minimize the chances of risk with good money management, agile & correct decision power. This is the business in which your strategies and experience required. With help of good broker you can be good and profitable trader.
The question is a little silly. Do you believe in Forex? If do you mean, does it exist...the answer is yes and it doesn't even take faith. Now, I think the question is do you believe you can make money in FX? Forex is the hardest trading game around and typically attracts the kind of people that will fail at any style of trading (the gambler type). You need ultimate discipline and control to win at FX. The worst thing about FX for most people is that it is open all the time and most people can't control their overtrading urges. I think if you are a 5-10 year veteran (profitable) trader in other markets, you have a chance since the only way you survived in those markets is to have impeccable risk management and discipline. If you are new 0-5 years, you don't have a chance. Here is a link to a great study done by FXCM about success rates. By far the best study ever done on trading statistics. http://www.fxcm.com/assets/media/pdf/fxcm-traits-of-successful-traders-guide.pdf
I don't agree with most brokers being bucket shops. But some brokers are for sure and their evil nature gives the industry a bad rep. The ones you mentioned are all acceptable choices.. each with their own catches though. Traders need to spend time understanding the trading conditions they are getting into before putting cash on the line.
I just started basket trading within the last month. Trading 14 pairs either long or short seems to take out some of the whip saws. The account is steadily climbing.