Trading Question

[jassielarry]

Hi can anyone please answer me...How difficult is it to trade profitably and consistently over the long term?

 

[MKFrost]

What do you plan on trading?

 

[Hendrix]

Well, put it this way, if you don't know what you doing, you gonna burn your fingers.
So it's not easy, you should start small, and learn the ropes.
Its not for novices...

But yes, It is possible to make good returns over time using common sense and solid stocks.
If you looking to make a quick buck, be prepared to lose it just as easily, don't be greedy.

 

[Rosaudio]

Hi can anyone please answer me...How difficult is it to trade profitably and consistently over the long term?

I've been working in the IB industry for 7 months now and not even I have bought bought any stock yet. There's so much to learn, and so much risk.

 

[HavocXphere]

Hi can anyone please answer me...How difficult is it to trade profitably and consistently over the long term?

Results are all over the place so there isn't really a correct answer.

Personally I've found it to be easier than expected. It depends in part on how you feel about the money invested. i.e. if you invest cash that you can't afford to lose then it'll screw with your psychology and you'll make a bunch of bad calls.

 

[MKFrost]

Hi can anyone please answer me...How difficult is it to trade profitably and consistently over the long term?

If you asked me a decade ago I would've said near impossible. Now, the answer is... very easy.

Hope that answers your question. Took me years and plenty of 'school fees' to get to the level I'm at now and even now I still screw up.

 

[archibald]

Invest in ETF,s, Satrix etc.Bear in mind it is long term, at least 5years.
However,dont play the JSE Casino you will loose the lot.

 

[Hendrix]

Invest in ETF,s, Satrix etc.Bear in mind it is long term, at least 5years.
However,dont play the JSE Casino you will loose the lot.

No, only wreckless idiots lose their money.
Lots of people make good returns by using their heads, and being realistic.
Education is the key, if you know and understand what you doing, you should be ok.
And it's nothing like a casino, it's not a game of chance...

 

[Taranis]

Hi can anyone please answer me...How difficult is it to trade profitably and consistently over the long term?

It's hard. Banks that trade make a profit by small gains by many traders over months. It isn't a casino.

 

[DJ...]

WTF?

 

[AdrianH]

WTF?

I concur

 

[MKFrost]

Take FX as an example. Only 2% actually make money. Google this and you will see. The Brokers thrive.
Now you want to beat them??

Not all FX brokers are market makers. Most of the more reputable brokers are ECN/STP brokers and they make their income from commission charges and or a markup on the spread. Because of this there is no conflict of interest and they have nothing to gain should you lose. Its actually in their interest to help you be profitable as this ensures a steady flow of commission.

Trading through a market maker i.e. a broker with a dealing desk is however the worse thing you can do. For those not in the know, what this means is that the broker takes the counter side of the trade. You are essentially trading against your broker. No matter what they say and or how 'honest' they are, there is a major conflict of interest as your loss is their gain.

In regards to the only 2% who make money in the FX markets. Yes the percentage of traders who are consistently profitable over the longer term is extremely low. The main reason for this is not just broker related but rather due to the fact that this is a leveraged market. Any leveraged trade carries a high degree of risk and this risk increases as your leverage increases. Most traders over-leverage themselves leaving extremely little room for error should the market move against them.

The barriers to entry for the FX market is very low. Anybody with R2,000 or more can open a trading account and be trading within a matter of an hour or two. Many see this as a get quick rich scheme and thus the reason for pushing their account into the red within a very short period of time as they do not understand the fundamental principles of leveraging.

 

[DJ...]

This whole 2% profitable traders baloney needs to be put to bed. Traders make money on the minority of their trades. A great trader is actually one who knows how and when to square his position properly each time. You ride the few percent you're certain you're on the right side of.

This seems to have been bastardised by people as only a few % of traders making cash, which I honestly believe is bull. The market would tank if only 2% of traders made tom. There's always a counterparty...

 

[Taranis]

Not all FX brokers are market makers. Most of the more reputable brokers are ECN/STP brokers and they make their income from commission charges and or a markup on the spread. Because of this there is no conflict of interest and they have nothing to gain should you lose. Its actually in their interest to help you be profitable as this ensures a steady flow of commission.

Trading through a market maker i.e. a broker with a dealing desk is however the worse thing you can do. For those not in the know, what this means is that the broker takes the counter side of the trade. You are essentially trading against your broker. No matter what they say and or how 'honest' they are, there is a major conflict of interest as your loss is their gain.

In regards to the only 2% who make money in the FX markets. Yes the percentage of traders who are consistently profitable over the longer term is extremely low. The main reason for this is not just broker related but rather due to the fact that this is a leveraged market. Any leveraged trade carries a high degree of risk and this risk increases as your leverage increases. Most traders over-leverage themselves leaving extremely little room for error should the market move against them.

The barriers to entry for the FX market is very low. Anybody with R2,000 or more can open a trading account and be trading within a matter of an hour or two. Many see this as a get quick rich scheme and thus the reason for pushing their account into the red within a very short period of time as they do not understand the fundamental principles of leveraging.

If you want to earn crumbs, yes you can do that. The banks are trading 24/7 on markets around the world with large sums (millions) using good info and software, and earning a crust. They can also afford to lose.

 

[DJ...]

If you want to earn crumbs, yes you can do that. The banks are trading 24/7 on markets around the world with large sums (millions) using good info and software, and earning a crust. They can also afford to lose.

It is an incredibly liquid market. You can fill your trades quite easily. I don't think you quite understand the silliness that you're asserting here, which is effectively that banks are your counterparty in every trade and that they somehow have the upper-hand because of...well...software and supposedly better info.

Market data is bought from market data providers. Whether you work at a bank or trade in your PJs at home. That data is live if you'd like it. No more live than the trader sitting in front of his Bloomberg/Reuters terminal. You can also purchase the same trading depth that they have access to if you'd like (in general). Settlement is also identical for both parties.

Large trading companies do have certain operational advantages and access to algos that can screw you over, but in general they're quite easy to spot if you know your asset. Smaller players will remove themselves from that sort of risk while that algo machine is doing its thing.

All in all though there's not some great conspiracy by the banks to steal your average Joe Trader's money - often they're just pretty good at stealing spreads. Trader A sitting in his PJs at home has just as much opportunity to screw over Trader B sitting amongst 100 others on a trading floor. People assume that the only competent traders are those sitting on a large floor. Nonsense. Many Asian housewives will teach our wet-behind-the-ears college graduates in their fancy suits a thing or two given level 2 depth into the same asset...

 

[Zukat]

Check ZuluTrade, Im still to witness a trader that shows solid consistent gains in the long run to stay in the top 10... so trading has become easy, but consistent profit trading is a different story.

 

[Greg C]

Amen. Its all these frikken ads with "invest now" I made 1000$ over 90 days woohoo. Utter junk.

This whole 2% profitable traders baloney needs to be put to bed. Traders make money on the minority of their trades. A great trader is actually one who knows how and when to square his position properly each time. You ride the few percent you're certain you're on the right side of.

This seems to have been bastardised by people as only a few % of traders making cash, which I honestly believe is bull. The market would tank if only 2% of traders made tom. There's always a counterparty...

 

[jassielarry]

Hi friends thank you so much for ur advice....