thanks for the tip i see what u mean
Margin level percentage 500% safe or not ?
- Thread starter atawil
- Start date
unfortunately i didn't get him lol
The odds of winning a $5 California Scratcher, ~1000:1, very similar to your forex leverage.
IMHO, you are much better off with a demo account to "tweak" your system. But as you put it nicely, to each his own, it is your money.
Good luck.
You are liable for more than the amount on deposit.
You should read the fine print in your contract with your broker. You can be liable for more than the value of your account and your broker will sue you.
How is that possible?
An actual example, 15 January 2015, the Swiss National Bank decided to remove the peg (the artificial government created tie) between the Swiss Franc and the Euro. There was no warning. There was an instant resetting of price by thousands and thousand of pips.
There was not a smooth transition of price, there was a gap. Stop losses were meaningless and they were overshot. Some stops closed at the low price, others did nothing, it depends in the setting of your account with your broker. Thousands of traders had their accounts closed on a margin call. But the loss is not limited to the value of the account. The loss is calculated on the price when the broker forces the close of your assets.
Some people were sued by their broker for large sums of money. You are obligated in your contract to make your broker whole. The broker is not there to provide you with free insurance on losing trades.
The event was so massive that many brokers went bankrupt, and many did not sue clients, but some did.
A more typical example since it is Friday the 13th. You hold a long position of USDJPY through the weekend. North Korea starts hostilities against the US on Sunday morning. When the fx market opens in Sydney on Monday morning (Sunday night on the east coast of North America) the price gaps. You have no stop, your broker closes your account at the market price on the open. You are liable for those extra losses and can be sued.
In the course of normal market activity, with smoothly trading prices in a liquid market, then yes, your broker simply closes you out and that close price will match the value of your account. But as mentioned above, there are exceptional events, or black swans, and the broker is not an insurance company for the feeble.
90 - 90 - 90
There is nothing free in trading. The professionals who have worked in the industry for decades are playing games against you that you do not even realize exist. Frequently it is your broker.
Overwhelmingly, new forex traders lose their entire account very quickly. 90% of traders lose 90% of their money in 90 days.
FRAUD
As if that were not bad enough forex is notorious for fraudsters pretending to brokers and operating from shit hole countries with no regulation. Deal with them and your money is lost the moment it is taken from your credit card. They will never return any money to you, it is gone. Winning or losing trades is irrelevant, they are simply thieves. Because there is no centralized exchange requiring membership (NYSE, NASDAQ, DAX, FTSE, TSE) these thieves can operate to steal from you. Of course exchange membership on its own is not a guarantee against fraud, but it reduces it.
Keep in mind there are some fine reputable brokers who spend a significant amount of money complying with the laws of the U.S., Canada, U.K., Australia. But some of them, while being completely within the law, will also run games against you that you do not realize.
Adapt or die
First thing is to learn. At the moment your knowledge is deficient. That is easy to remedy; but will require your abandoning the idea of instant riches and realize that you must study and learn a profession. Medical doctors, lawyers, engineers all spend years of study with a professor, and then continue their studies under the tutelage of an experienced practitioner. That is what you need to do.
@Xela frequently references a book by Van Tharp as a first step for a new trader. My suggestion is that you search for the exact reference (if you are not willing to do something so simple as search for the title there is no point in assisting you), get the book (I always prefer libraries since they are free, but Amazon will have it), read the book once, then study it several times.
Then come back with your questions.
edit: changed the example of USDJPY to long, a short would make money. If you cannot predict with certainty the ramifications of an obvious and contrived geo-political event, then perhaps FX is not the best vehicle for you at the moment.
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my broker have negative balance protection meaning traders only lose up to their DEPOSITED amount .
thats why i dont trade between weeks every one has his own conditions
90 days for new traders is impressive
posting a thread in a forum is harder than searching for the book title . "For me"
I'm dazzled by most of you guys here that as soon as someone want to propose something or assume something different the whole majority disagrees
I rephrased my question at the upper posts which is what the least margin level considered to be safe and here I am getting slayed nearly hanged because I used high leverage term
and someone above said its gambling?
what i believe that gambling is 1000% luck
this is not if this was the case then i was out of this activity long time ago
Then your broker is running a game on you. If this is true then you should seek out trades over the weekends.
Every high risk, high reward, gap over the weekend now changes to limited risk and high reward. Start printing money.
Best of luck to you.
DONE
thanks take care
The bit that is bolded is a problem.
At what account size does losing become meaningful? Making $250 on a $20 account may seem impressive in percentage terms, but then again since in your mind losing $20 would mean nothing to you, than winning wouldn't either. Maybe that is why you are "losing recently."
If you have to ask if "500% margin is safe or not", you don't have a grasp on risk and the terminology methinks, as Xela suggested.
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I'd like to believe that risk is overrated maybe thats why i deposit small amounts consider instead of depositing for example 10k in your broker account keep it in your bank and deposit the amount of trade you want to risk and try to get a hefty profit percentage and believe me this need more trading skills than dealing with thousands usd accounts as you are on tight margin levels that's my approach maybe its wrong but I feel it suits me
maybe 500 was not bad after just needed a behavioral re structural