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You are calling the whole world a fool, every time
you buy and sell...
Pal,
I have a different opinion:
The symbol of all relationships
among such men, the moral symbol of respect for human beings, is the
trader. We, who live by values, not by loot, are traders, both in manner
and spirit. A trader is a man who earns what he gets and does not give or
take the undeserved. A trader does not ask to be paid for
his failure, he does not ask to be loved for his flaws. A trader does not
squander his body as fodder, or his soul as alms. Just as he does not give
his work except in trade for material values, so he does not give the values of
his spirit -- his love, his friendship, his esteem – except in payment and in
trade for human virtue, in payment for his own selfish pleasure, which he
receives from men he can respect. The mystic parasites who have,
throughout the ages, reviled the trader and held him in contempt, while honoring
beggars and looters, have known the secret motive of their sneers: a
trader is an entity they dread - a man of justice.
Ayn Rand
<BLOCKQUOTE
>
----- Original Message -----
<DIV
>From:
palsanand
To: <A title=amibroker@xxxxxxxxxxxxxxx
href="">amibroker@xxxxxxxxxxxxxxx
Sent: Wednesday, October 08, 2003 8:07
PM
Subject: [amibroker] Re: OT Forex for the
sublimely naive
Hi,> > First of all, to address the claim
that you cannot lose more than> your investment in Forex trading:
Pure, unadulterated horse hockey.> > I'm sorry to be the bearer
of bad news, but I am positive that you> can lose more than your
initial investment on ANY leveraged play. I> am 100 percent positive
that if you look at the fine print on your> brokerage contract, you
will see something along the order of: "will> **attempt** to liquidate
your position should your equity value> suddenly break certain levels",
zero being the last ditch, they will> first have a level for a "margin
call" and another level for a> liquidation below that. Note however,
that it will NOT always be> possible to get you out at a price that
ensures you do not experience> negative equity, and further note
that your brokerage does NOT for> one hot second intend to take a hit
on a position you created if it> goes against you so suddenly that your
equity becomes negative.> Believe me, they intend to come after you for
the balance; I'm *sure*> it's in the fine-print of your contract
(if not the bold-print); and> yes you CAN lose your house. Will
you lose it? Probably not. But> you can, or at least you can take
a hit far in excess of what you> planned to risk, and you should not be
deceived about that. Enough> said on that.Your broker does not
take you out of the market, but the trading platform software does.
It takes you out (closes all positions) when you do not have sufficient
margin (Guaranteed, rest assured).> > Next, the joys and
perils of leverage:> > It is, as most of you know, a very sharp
double-edged sword. When> you are right, it is a gains
multiplier. When you are wrong however,> it is a loss
multiplier IN EXACTLY THE SAME PROPORTION. There is no> way I know of
to have the potential for huge gains, without also> having the
potential for huge losses. Anyone who suggests otherwise> is
either sublimely naive or has an agenda, IMNSHO.Sometimes, you have to
have narrow stops, sometimes wide stops and sometimes no stops (combine
options with the straight underlying instrument) to Cut losses short and
Let profits run.> > Finally, a bit of a historical
note:> > I have been around for some unreal yen/dollar
moves. I have seen the> trends reverse on a dime, with
explosions in the other direction that> will rattle your teeth and
turn your position to ashes, especially a> leveraged position. Take a
look for example (and this is a rather> mild one) at the "trending
move" in late 2001 that took the yen from> about 120 up to about 135
very suddenly. Then look at the yen at 120> 6 months later
going the other way. These things are just as tricky> to time as
stocks or futures or you name it. They are not one bit> "easier",
and if they were, so many sharp people would immediately> come into the
market that any "easiness" would soon vanish as the> sharpies started
dueling with each other. Do not be deceived about> this for one
second.> > None of this is a plea to avoid the currency
markets. They can be> traded, and they can be traded
successfully. They are not casinos> where the odds have been
turned in favor of the players, however.> They are dangerous places
where very sharp people hang out, people> (not to mention central banks
that can print fiat currency at will)> with REAL CASH in quantities
that can OVERWHELM your puny little> high-leverage position. They
are just waiting for you to make a tiny> little mistake, believe
me. Keep that in mind, and you can probably> play (somewhat)
safely.> > Okay, I said my piece. Back to work
everyone. ^_^> > YukiWell, I don't just
trade because I'm smart, but because I'm the smartest man in the
world... That is exactly what you say every time you buy and
sell; You are calling the whole world a fool, every time you buy and
sell... That you bought or sold the underlying instrument (whether
stocks, bonds or futures or FOREX) before everybody else did...
Trading is the most ARROGANT thing a human being can do... If you
want to make money trading, don't be just arrogant, be smart
too...Regards,PalSend
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