98 % of 4X traders lose money - Why?

PetDane

Private, 1st Class
Messages
43
I am quoting from FPA education section here. I have no idea how these figures are obtained or how accurate they are, but it does seem to be generally accepted the vast majority of traders do lose more than they make over sustained period.
Why? Some brokers may be partly to blame, but this can only explain a tiny fraction of the figure. Most comentators appear to assume that it is the traders own ignorance and/or willful behaviour that it is to blame.
While this probably does explain more loses than the dishonesty of some brokers I find it hard to believe that it really covers this emourmous figure of 98% - this is as bad as the casino or race track!
This just does not seem to make sense. I naturally have my own theory about this matter, but I will refrain from sharing as yet, until I have checked it more carfully. What I am interested in at present is any other explainations or points of veiw on the most fundamental of all concerns for traders that anyone can come up with.
 

Pharaoh

Colonel
Messages
19,777
I think 98% is an exaggeration. I've seen numbers ranging from 80% to 99% tossed around.

I think a more truthful statement is that the vast majority of active new traders in any market end up losing a significant part of their initial investment. Some of this can be blamed on bad brokers. Some can be blamed on believing the advice of a bad signals services or other trade selection "expert". Some can be blamed on blindly following some "sure-fire no-lose" method sold online. For those who avoid all of the above pitfalls, the losses usually are due to poor risk management and/or allowing emotions to overcome logic when price moves against open positions.
 

PetDane

Private, 1st Class
Messages
43
Hi, thanks for your detailed reply. Yes I heard that kind of failure range. It would be nice to know more precisely though and if there is anyone who makes money who is not working for, or has worked a major institution.
 

dkami

Sergeant
Messages
749
I think it would be more accurate to say only 2% of traders make big sums of money in forex;)
 

FXProgrammer

Private
Messages
18
just focus on improving, study, spend hours in front of charts, question everything, study some more, etc

don't worry about how much money other people make or lose
 

FXProgrammer

Private
Messages
18
And the general rule is to risk no more than you afford to lose. I'd not recommend investing all your savings in Forex, no more than 20% of your investments, these will be risky actives (there is the recommendation to invest other 40% into very reliable actives and other 40% into actives which are less reliable and more profitable)
 

Klem

Private
Messages
27
The problem is once you taste the smell of 500 pips... I know it is totally right everything stated above, but... :)
 

Aesop02

Private, 1st Class
Messages
54
Yeah 98% seems very high, i reckon there's probably more like % groups who make smaller sums who can still get buy, but aren't making hundreds of thousands.
 

fxjuanito

Recruit
Messages
3
98% sounds pretty high to me. Could be lower if everyone starts practising wise money management. Never ever risk more than 3% of your total capital per trade. This has been told repeatedly many times but many still ignore that. Based on my own experience, risking not more than 3% per trade will allow you to remain in the trading game even if you suffer a string of losses.
 

Mr. Euro

Private
Messages
10
it is some thing around 80-89% who loss money, having many reasons. like lack of forex trading education, lack of skills, depending on wrong signals, trust on not suitable brokers, etc. Those who trade safe always careful about the risk management, time management and have required skills which make them in remaining successful %.
 
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