F Over the last few years, it has gradually become a home truth to many aspiring traders: 95 % of those that enter the trading arena do lose money and have to pull out in less than 12 months. Yes, that’s right, 95% of self traders lose and this is definitely the case in forex trading.

How do we know this is the case? Well, numerous scientific and less scientific articles have been written about this subject, but anyone with good contacts in the broking world will have had this percentage confirmed by the horse’s mouth… Brokers and market makers know the losers’ percentage very well, even to such a degree that they don’t even bother covering the bulk of their retail clients’ trades.

Yet, despite this devastating number, financial markets, and especially the FX markets, keep seeing fenomenal growth in popularity, especially in the retail segment. Every one is becoming a FX specialist these days and new brokers enter the market every day because the demand for prices and liquidity from retail self traders is so vast. Forex looks so easy to understand and the prospect of a few thousand dollars profits in a matter of seconds is simply too appealing for many.

It is however fair to say that, the more and the longer professional experience one has built in trading FX (such as ourselves), the more one acknowledges that making consistent profits in the FX markets is extremely tough and hard, requires long and hard work and a particular mindset. There are very few good Forex Hedge Funds and very few succesful Forex CTA’s. There is a reason for this. Anyone professionally involved in Forex will confirm how hard it is.

Even professional and seasoned traders can go trough periods of drawdown and self-doubt. That’s when we at ProForexLive can be of help. We are not in the business of selling software, advice, tutorials or mentoring. We don’t want to participate in the snake oil business of selling worthless FX products to unsuspecting newbies on the road to the 95% graveyard. But since we do offer a Trade Room Service where pro traders can meet, discuss ideas or simply get trade entry and exit levels in times of need, we might as well share a few insights with you, based on many years of professional trading in top tier banks and trading houses and reading hundreds of trading books, magazines and articles. These simple insights are probably worth more than all the books, mentoring, trading software you will ever buy. We will share these insights with you over a number of articles.

If you want to be successful as a trader, make consistent profits and trade from comfort and strength, you should first of all make an effort to understand what builds trading success. Why is it that 95% of self traders fail. What is it that makes the 5% of successful traders successful? What processes are involved? What is it they are actually doing to make consistent profits?

We will answer these questions in the next, but we can already mention some of the reasons why so many fail:

they are overleveraged (their accounts are too small for the market
exposure they seek);
lack of proper methodology;
they are too emotional;
totally unaware of the required skill set;
unaware of the required mindset;
Lack of realistic objectives;
wrongly focus on ”being right”, on ”predicting” as opposed to probability
thinking and technique.