Six Reasons Why My Project Will Fail
February 11, 2007 by Trader Rich
I don't know what the outcome of the forex project is going to be. If I had to put a bet on whether or not it was going to eventually succeed, I would have a very tough time deciding. I'm not even sure if I would put the odds of success at 50% at this stage in my learning cycle.
Fortunately, I'm a fighter and I don't give up easily. I've told myself in discussions that I have to give this project at least 5 years of my life before declaring it a failure. I still have 3 and 1/2 years to go. Nevertheless, I feel that if I put possible reasons for failure on the table now, it may help me overcome them. Read more to see the top 6 reasons why my project will fail.
- No guts - It certainly won't be easy to give up the
bi-weekly paycheck, bonus, life insurance, health insurance, and
flexible spending account that a US corporation provides me. Trading
full-time means giving all of this up and relying on my trading to
provide for me and my family. - Lack of Capital - It
would be a bad idea to decide to trade full-time with too little
capital. I honestly don't know at this point how much money I'll feel
safe starting with but if I cannot accumulate enough capital between
now and then, I'll never be a full-time trader. - Inconsistency
- If I cannot be consistently profitable in the months and years
leading to trading full-time, it would be a bad idea to still consider
this as a career. - Failure to Control Emotions -
I already feel like I've made great strides in this department but I
have to continue to work on controlling my emotions when trading. If I
feel like I cannot take the daily ups and downs of the market, forget
about trading for a living. - Lack of Commitment -
Learning how to trade and trade profitable is a lot of work. There
have been a couple of times where I thought I had lost my commitment. - Fraud - I can't totally dismiss that another Refco type situation could occur in the Forex market. I'm already skeptical of some of the Forex regulation or lack thereof. If I don't have confidence in any FCM because of some future event, then trading Forex full-time will never be a reality.
If I had to pick which reason above weighed on me more than the others, it would have to be #1. Hopefully I can show that I can be consistently profitable. I think if this happens, I'll have the guts to take the challenge head on without worrying about what I'm giving up. What I would be gaining will be so much more, financial freedom.
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I wish you luck on succeeding. I know you said that you haven’t been having much success lately, but give it time before thinking too negatively. I personally believe that psychology and discipline are the largest determining factors in failing at trading. Thinking negatively may impact your progress. Also remember, that the only way to succeed at anything is if you have a plan. You can address all the problems you’ve listed over time with a plan.
Overall, the only factor on your list outside of your control is fraud. This is a concern of mine as well, since forex brokers are so lightly regulated. However, I’m pretty confident in Oanda as a broker. Still, it’s a good idea to have accounts with different brokers. That way if one broker commits fraud, you won’t be losing all of your trading funds. Just a suggestion.
Wish you all the best Rich. I agree with your list above and hope that you can prove to the rest of us that retail FX trading fulltime is possible. I’m going into my fourth year of trading/learning this market and have not done nearly as profitable as you have so far. I’ve gone through the ups and downs, the thoughts of quitting, to the realization that I MAY finally have a way of succeeding in the market. But again the only way to know is in the account statement. I will see in a few months whether or not my system will come to fruition.
I enjoy reading your site very much and have not skipped a day since I came across this. Thanks for sharing all the info you have on this site.
I come regularly to your site and enjoy it for the various interesting analysis you do. It helps me to move forward aswell.
I’ll add my 2 cents concerning your remark 1 & 6
1/no guts: after 15 years of hard work for multinationals , my hope is definitevely to work for myself and not depend on others. There are good times, great projects, nice pay, a lot of travel but here in Europe, in the back of your mind you know that approaching 45 years old , as a middle-manager you become seriously at risk because you cost too much for the company which will not hesitate to dump you at the first occasion for young guys with long teeth.
That’s why you are extra motivated to reach success trading. By the way I wonder how you can follow the markets , trade and work at the same time ?
I do it aswell but it’s quite difficult and stressing.
Though I have good working conditions: my own office, all computers access but keeping your mind focused with other duties is particularly heavy and leads to multiple trading errors.
6-Fraud: yes ,beware the crooks ! I have probably been one of the last to be reimbursed. As soon as I heard there were questions about accounting tricks I pressed the button to get a full refund.
Since then I am extra carefull and would advise only to go with highly reputable companies like I.B. or a bank. ( I don’t know if US citizens can open trading accounts abroad) In Europe and Switzerland, deposits are legally protected even in the case of total bankrupcy. ( well there is a maximum for the amount protected but it sure is high enough for me.)
all the best with your trading
H-D
For a long time I read your blog and I enjoy it. Its real and it’s a true FX Trader life. Never was in my mind to post a comment, but that one make me change this way.
I read your comment and I start thinking about it. There was a time that I was in the same direction of you. I see how dedicated you are to learn FOREX and how serious you look for information and trade systems.
I trade FOREX for an year. I started in this market with a small tech analisys course. After a few days I saw that FX is not that easy as my mentor said. I join a live account and after 3 months I’ve lost 15% of my capital. The result was - back to the project desk. Study more. But where? what?
I knew one Intensive Forex Trading Course a few months ago. The FXBootcamp is managed by a great Trader Wayne McDonell. The FXBootcamp is a FOREX live 1 to 1 trainning couse. Everyday you log in the “class room” and trade with the coach based in fundamental and technical analisys. As you trade you receive a lot of information about technical trading by lessons and fundamental analisys based on a very simple strategy: Plan your trade and trade your plan.
There’s about 150 Fxbootcampers on line each day in London and NY session. After the session you have a video about the strategy of the day and the comments about it.
Please, check it. You will see something in YOUTUBE at FXBootcamp.
I’m not an employee or receive anthing from this guy to say it. I do the trainning course and I may say that is 100% possible to live of FX Trading.
Every first friday (NFP) there’s a web seminar (live) in http://www.fxstreet.com and Wayne trade it live. The last one had about 500 traders on line. Try it. There’s about 10 old students that will quit their jobs in a few to live as FX Traders. Believe me it’s possible. My goal is to be full time tradind in 3 years: 1 learning, 2 capital aquisition and 3 quit my 9-5 job.
Anyone else have anything to say about fxbootcamp?
Rich,
Take a look at this comments: http://www.forexbastards.com/fxbootcamp.shtml
This guys are traders Like us. If you’d like to know more, please get in the free webnar in Non Farm payrolls at FXstreet.com. The free subscriptions are about a week before the NFP annoucements. I hope you enjoy.