39.1% of the Forex traders are profitable
Why so many lose in
Forex and what adjustments the losers traders have to do in order to be among
the select group of traders who consistently earn Forex?
Well, until we deepen
more in the theme, first we will analyze the claim that 39% of Forex traders
are profitable. The information was provided by the Forexmagnates site through
a report on the profitability and performance of Forex brokers. The most
prominent figure was 39.1% of profitability for customers of a broker who had
around 24,000 active accounts.
There are also other
interesting snippets of information that are worth noting before going ahead.
There was a sharp drop
in the number of accounts and levels of activity in 2011, while the percentages
of profitable traders increased. This could suggest a couple of points of
interest, firstly, traders may be improving collectively in their activities in
the market or (and is not mutually exclusive) many beginner traders have simply
abandoned the market, returned to work 5-9, leaving the field open more
competent traders whose superior results have improved the statistics data. We
have also seen a reduction in the number of Forex brokers, which has caused
that only the fittest traders supported by brokers to better comply with
regulations regulatory end up prospering, when before many traders operated
with deficient brokers services that ended up cause them losses.
Forex brokers industry
to the United States retail is showing clear signs of slowing down, and in fact
these companies report that the number of trading accounts has been
backsliding. The extreme regulatory climate has made it extremely difficult for
U.S. brokers to attract new customers. However, many customers of these
companies show a high level of benefits and are cost-effective in the long run.
It is fascinating to
see how many can find this fact quite striking and contrary to some of the most
common preconceptions about the Forex. To my and many others claim that only
10% of traders are profitable is nonsense. Although most traders end up losing
in the market, there is a lot who operate responsibly and with a sensible and
well thought out trading plan, and therefore profit more or less regularly.
A question often posed
by this type of statistics of success is "Are the figures by a small
percentage of winning traders distorted being?” However, overall percentages,
averages, and the distribution of the random data do not work that way, a basic
knowledge every trader should have. If around 40% of the operations are
profitable then the number of the percentage of traders who have a positive
return should be fairly close to that number.
In the first paragraph
we raised the question of why are so many losing traders in the Forex market?
Armed with this new information one might wonder whether that assumption should
not be examined in more detail. If we listen to the data, about one third of
United States Forex trading accounts is profitable, or at least was in 2011.
Certainly these statistics indicate most traders lose money in Forex, although
not 90% catastrophic stating above. In these data, the distinction between
full-time and part-time traders is not although we could dare to say that
operators presenting best results are those who dedicate more time to this
activity, as opposed to traders who enter the market from time to time to bet.
This assumption seems
logical if we think that to be trader in time full (at least for a period), the
person must have profits, i.e. which has to be profitable over time, otherwise
could not engage in this activity 100%. Probably traders today are educated
more than before and in addition, some of these people may be traders who
started his career years ago and persevered despite initial losses.
Turning to the question
posed in the initial paragraph; "Why so many lose in Forex and what
adjustments the losers traders have to do in order to be among the select group
of traders who win consistently in the Forexs?" Then we leave them with
the six main reasons and please feel free to join this blog with your own
suggestions or additions. Now we will not investigate the reasons or to provide
solutions, is a simple and more complex list, the answers are there, the
solution is obvious.
But first, let's
recapitulate: If about forty percent of traders succeed in the Forex market,
this means that this objective can be more within reach than many have
foreseen. This is an important stimulus for novice traders.
The six main reasons why traders fail
2.
The lack of risk management
3.
Greed
4.
Indecision - doubt plan
5.
Try to choose maximum or minimum
6.
You refusing to accept losses
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