He has a monthly readership of , traders and has taught over 20, students. However, this myth is not based on any solid evidence or statistics, rather it is a general statement that is factually incorrect and usually based on broad assumptions and flawed logic.
Unfortunately, this myth also inhibits many traders from reaching their full potential and instills misplaced fear into their minds from the very start of their trading career.
Remember to Share it around with others: So, what are your chances of succeeding as a Forex trader?? This is a very important question that deserves some logic-based discussion, rather than the vague general statements that we so often read on the internet. This is a very important question with far-reaching implications. Basically, there are always people making money in the markets; in theory, for every loser there is a winner.
However, consistently making money is a different story, so over the long-term there are going to be fewer traders who have made money than who have lost money. As you learn and become a more skilled trader, you can shift your goal up from profiting each month to profiting each week, and then eventually to pro-trading; over-time you will see your trading improve and your trading account grow.
When your expectations are more in-line with the reality of trading, you will have less desire to over-trade, and you will feel less desire to trade large position sizes as well. Since you feel no pressure to rely on your trading exclusively for income, you release most, if not all of the emotional attachment to your trades and to the money you have at risk.
This is a very important point that has far-reaching implications on your success as a trader. Releasing your emotional attachment from the market as much as you can is the easiest and quickest way to experience success in the markets, and it is done by having realistic expectations, meaning not expecting to be a full-time trader right away, in other words, Forex trading success comes from within.
As you can see in the chart below, with a risk reward of 1: As your risk reward moves up you can win less of your trades and still breakeven; a risk reward of 1: I often discuss the power of risk reward in Forex trading , and for good reason, it is a concept every trader must understand and it is the best way to see how letting your winners out-pace your losers makes successful trading easer to achieve.
However, risk reward is not the only thing that makes a trader profitable over the long term. You also need a high-probability trading edge like price action. This will greatly increase your overall odds of making money on a regular basis in the markets, as we will see below. With only random entry and risk reward in Forex trading , you are likely to just perform around breakeven over the long-run.
Note that your chances of winning actually decrease as the risk reward ratio increases, this is because your target is further away and your stop loss stays the same distance, thus the percentage of your stop getting hit increases as your target increases, so we need to stack the odds in our favor as much as possible by using a high-probability entry method like price action.
By analyzing the images above we can clearly see that the an educated trader who has a solid Forex trading plan and who knows exactly what their edge is in the market, has a much higher probability of making money than a non-educated trader who is essentially entering randomly. So, your first priority as a trader should be to master these two things. Making money in Forex is NOT unattainable…. This is a much more attainable goal right out of the gate. Doing this will lift your chances of success dramatically because it will give you a REALISTIC GOAL and will allow you to avoid the common mistakes so many traders make due to the fact that they try to rush into being a pro right away.
As a Forex trading coach it is my aim to push traders onto the correct path that gives them the best chance at success in the Forex market.
So, it gives me great satisfaction to know that I have helped so many traders through the quality content that I offer and the repetition of the concepts I teach, because this gives traders a far better chance at making money consistently than if they have no formal Forex trading education or no effective trading method.
Hi Nial,I really believed ur detailed articles on Fx trading…you hardly hear the truth of the risk behind Fx trading from a trader. But it happens when you see a qualified traders…Thanks for the enlightenment. Nial said to have this two keys, number 1; Understand risk reward and forex money management, and number 2; truly mastering a highly-effective trading strategy like price action. Really took a load off my chest.
Until now I have been counting heads on how many have been successful in trading forex, now I think I should stop. Thank you Nial for sharing your valuable knowledge. It has taken me over 4 years to start making consistent profits.
I love this article. It takes everything in consideration. It is all relative. So with that said, they all say that there is not one loser to one winner. They are comparing themselves to a government or bank. It is funny that some people buy the same amount as a bank it government would. They are buying millions and you the little guy are buying thousands or hundreds. Make a little like you said is like a bank making thousands which to them is the same as what you made from what they risked.
I like how some people think that they are the high rollers. Just my thoughts but I think that your article is great as I have been through these changes and have been trading for 6 years. This is an honest and fantastic article. This one is absolutely perfects. Articles like this should be read on and on and ona and on. Thank you very much Nial for you excellent work.
When I get regularly profitalble I will let you know. A very important article for anyone in pursuit of trading success. I have looked deeply into the question of why so many fail to really make it in this game, and this article really does provide most of the answers. The reality is, that most people do not approach trading as a business, they are not professional or organized enough in their approach, and do not set out to really learn the business of trading before they put their money on the line.
People also come into trading with entirely the wrong mind set , and most likely because they are seeking a change of lifestyle from one they are not content with. This equates to a low self-esteem, which will then deepen as they begin to lose their money in the forex arena, and very soon , they are gone.
This was exactly my situation, coming into trading from a job I hated. I grimace at the naivety of that now, but I was like just about every other new trader out there. Far from giving up however, i set about learning the game for myself, and I have spent virtually every spare moment i have had for the last three years learning how to trade forex successfully.
It is now my only form of work, and I run it as I would run any business- i am organized, disciplined, and methodical, I was none of those before. I al;so firmly believe that I will become the best trader in the world, you may laugh or sneer, but I honestly do. After that, the sky really is the limit. As a newbie in forex trading, I aim to make consistent profits from my forex trading but have stumbled and fell many times along the way thus losing money instead of making money.
After reading your article, I am aware of my mistakes and would definitely apply the idea of having a trade plan with proper risk reward ratio and also using price action to trade instead of all those lagging indicators.
Very interesting article indeed! I should have taken your course before I open live account, and now I have to save money if I want to get your course and trade live again.
Thanks Nial its articles like this which make all the difference to novice traders like me. Thanks for sharing all your wisdom and guidance. Very good article, I can finally see risk to reward alot better now since I found you. Letting the market do the work and not biting your fingernails on each trade is a breath of fresh air.
To all newbie like myself stay on it. Great article and your site and course is the best investment I have done. Nial, Thanks for a great article that gives hope to many who may have been disillusioned into thinking they cannot make it. This ties up some loose ends from a handful of other articles and gives a big picture with some real clarity. Hi Nial been trading a small account for four months now,three months profitable.
Feel like i am starting to turn that corner since i bought your course, thank you again for all your help. As I have learnt, when trading price action with a trading plan, my risk reward ratio equals profit. When I consistantly profit, my natural reaction is to increase my risk reward ratio.
As a consequence my emotions end up driving the temptation to over trade because of my confidence. When I experience loss I rethink my strategy and remove my emotion and go back to my trading plan. As always your words of wisdom is confirmation of my own process. Thank you Nial, I have learnt so much from your lessons. Risk reward is so important in fx trading. Thank you for putting so much energy to provide articles, videos, daily Commentry.
This learntotadethemarket membership is great value for money. Personally, I went back to trading after not trading for a couple of years and reeducated myself on the markets. I doubled my account in 2 weeks with what you taught me and I added some of my own analysis to my trades. Nial, Your simple approach to trading is the only thing that I have found to be successful over an extended period of time.
Thanks for guiding those that are willing to learn. Thank you for a directional change in my thinking. It takes the sting out of forex for me. This coming June I will be two years in fx and realize that I am still on page one, first paragraph.
Thanks Nial, A great article,a good real lesson. For some time, I am loosing money again and again with out any control,but I admit myself that my reaction to the market is like a gambler,no princple,no patience,rule or any plan.
I will be successful in trading,but I have to change these bad habits and for ever. Either stick to the rules or forget the trading. That is the promise. Thanks Nial for openning my eyes so many times and this will be the last time. I really enjoyed this article,a very valuable lesson.More...