Author Archives: Razvan Podariu

FXOpen Is Why Im Broke

 50 Words on – Why you can go Broke with FXOpen?

I am one of those people who think that the rules are made to be broken. Not all the rules though. Is not like I am going around and steal, cheat or kill people but I do like going 200Km/h on the highway even if the speed limit is 130km or to pick a flower in a park although I see the sign that says that I can be fined for doing it. The adrenaline that I feel when I go 200km/h or the look of my girlfriend when I gave her the flower, worth the risk. FXOpen has different trading accounts with different rules to be respected (as any other broker) and if you break those rules, you can go broke. The problem with FXOpen is that you can go broke even if you respect the rules. Kovacs Norbert submitted a case against FXOpen on forexpeacearmy.com website where he claimed that this broker removed all the profits from his trading account. We are not speaking about pennies here but about more than $40k. As you can see on this link. FXOpen got a big time GUILTY verdict on this case.

 

How can you Avoid Going Broke with FXOpen:

I noticed that many of the negative votes that this company has, are given by traders that opened an account with them without knowing the main features of the trading accounts that this company offer. On the other hand, Norbert knew what he was doing and this did not help him. Here are a few advices that could help you to avoid going broke with FXOpen:

  • Do your research about this company and its trading accounts before opening an account. Once you do it, the willingness to open the account might vanish (:
  • FXOpen allow traders to open trading accounts with as low as 1$ deposit. That’s more than enough to lose (sorry I meant to trade (:)
  • Read the terms and conditions as many times you need. If you have questions, email FXOpen and ask for more information before opening the account. In your email, you could ask which condition was not respected by Norbert that they had to delete $43.405 from his account.
  • Be sure that you open the account with the proper company. FXOpen NZ limited does not provide financial services to residents of Australia, New Zealand and Italy. Residents of New Zealand and Australia are welcome to open the accounts with FXOpen AU Pty Ltd while the Italian residents are welcome to open accounts with FXOpen Ltd. The residents of any country in this world are welcome to open accounts with trustful Forex Brokers. There is a wide choice.
  • On their website’s stated that they have 172827 micro accounts opened. Make sure that you will not be the 172828
  • FXOpen offer demo accounts for free and for unlimited period of time. Use these accounts only.

 

 Editor’s Note – Would I Trade with FXOpen or Would I Pay my Fine?

When I said that I like to break the rules I did not mentioned that I am also aware of the consequences: if I get a speed limit fine, I pay it. When FXOpen decided to delete those profits from Norbert’s account, they broke the rules. Before the regulators would fine them (if they will ever do), I will be the first to do it by saying that even if FXOpen would be the only broker in this world, I would definitely NOT give them my money. I prefer playing the lottery. Moreover, I also advise you to do the same. Trading with fixed spreads on their micro and standards accounts or variable but starting from 0 pips on their STP and ECN accounts could be very tempting. This temptation could rise when you see that this brokerage is working under strict controls of the regulators as FSPR in New Zealand or FCA in UK. From where I come, there is a saying: “before reaching the God, you have to deal with the Saints”. Translated to our situation would be before reaching FSPR and FCA you might lose more money on lawyers.

 

Trading Forex On Demo Could Get You Blind. Enlightening Opinion

Why does Trading on a Demo Account could get you Broke?

I think that every single trader started his journey in the Forex world with a demo account. I know I did. Practicing with virtual money before using your savings should help you know better the trading platform and the broker but mostly…the market. When you are a newbie, you think that the market is like a hot girl and you want her in your bed. However, being a “newbie” you have hard times trying to invite her over, so you go on “demo” using your thoughts, or your very own body parts. Boy, if you think that Forex trading is “demo” trading you are dead wrong. If you think that more demo trading will get you more experienced, you are wrong again. The question is: do you want to get laid or die trying?

 

How you can go Broke from Trading Forex on Demo Account?

Don’t get me wrong, I think trading on demo accounts is very useful and that you need some time to get used with this new “thing” named Forex, but I also think that masturbating is not the same as having sex (pardon my French). Well… you feel pleasure and reach climax on both case… However - and correct me if I’m wrong – the pleasure is far more intense when caused by a woman (sorry ladies, this is written by an ape… I meant a man) than by your very own hand. That the reason if you keep trading on demo for long time, you could get blind. Wait…that was for something else and it’s only a legend…they say. But I should ask Forexit – this is the nickname a trader uses on Babypips.com forum [1] – as he said he is doing it for more than 6 months and now he feels ready to get out there and grab a real woman – sorry, I wanted to say a real money account. And Forexit is not the only one in this situation as I keep seeing on various forums. Traders advising other traders to practice more on demo before going live or even to start with as little as 50$ - 200$ real accounts. But this is crazy. Even if someone advises you to go longer on demo, and even if that that person is an experienced trader, why should you follow him? As George Bernard Shaw (Irish dramatist and co-founder of London School of Economics) said, “why should we take advice on sex from the pope? Even if he knows everything about it, he shouldn’t.” The demo accounts are not offering EMOTIONS - greed, fear, hope and other feelings. They are pushing the traders to take irrational decisions, which could cause them losses, or booking only small profits while their initial take profit order was larger. Others might get broke, I’ve seen them going. The first few trades you’ll place on a real money account will make you sweat in the same way as “your first time with a woman” made you. And even the second time, with another one. Besides that, the demo account will never make you over-trade. How many times you happened to be over-confident after a series of good trades and instead of taking a break you go for another trade and another, and another one more time… the only difference is that this time you are losing money. You are losing the profits you just made a few hours earlier, or you’re losing everything you’ve got. This never happened when you were trading on demo, isn’t it?

 

 

Conclusion – Use Demo, Do NOT Over Abuse It.

All sex psychologists say that every person needs to know itself and to know his or her own body, and that masturbation is a good way to do. But do not abuse it. I think it works in the same way with the Forex demo accounts. Too much demo really sucks and will never prepare you for the real trading. Trading demo too much time won’t make you a better trader but a better loser. Once you know how to use the tools on your trading platform and you have the basis of the trading, close the demo and get on real money. You don’t need six months for that. Think it in this way: if an average human life is 70 years, no one needs more than one single year to learn how to walk. Here are a few tips for you:

  • Even if you are on real money now, you can still use the demo to test a new strategy (strongly recommend to be your own strategy and not someone else’s) or you can use the demo to test how a new instrument acts. For example when Bitcoin was launched, the demo account was a better choice than the real money account, to see how BTCUSD is trading.
  • If you like the automatic trading, you can use the demo to test the EA you just bought or maybe build one yourself.
  • When you start to trade on demo, at least ask your broker to make the demo as big as your future real money account. Is really useful to trade 50000$ on demo while you will only deposit 1000$ when opening the real account.
  • Even if you trade on a demo account, – meaning simulated market conditions – I suggest making realistic assumptions. Use a margin of one up to five pips when you place your entry, stop losses or take profit orders as in the real market conditions quite often happens to see them executed at a different value than what your set ups – especially for entry orders.
  • The simulated trading environment does provide a trader with the opportunity to get used to the software he will be using or with his broker’s trading conditions. Use the demo account only for this purpose and do not try to build a reputation by linking the account on websites as www.myfxbook.com or www.fxstats.com because no one cares how good you are on demo.
  • Least but not the last, try to avoid the demo accounts with unlimited use. If you can’t stop to trade on demo your broker will, by denying you the access to the demo and inviting you to open the real money account.

 

References

  1. Babypips.com How Long Have You Been Trading