In this episode of Truth About FX, Walter tackles one of the biggest trading barriers: financial disadvantage. Should finding good trading resources be expensive? According to Walter, it shouldn’t be… Actually, the best trading education is available for FREE. He also talks about some useful tips that will help you set your risk per trade and build your confidence based on your habits.
Download (Duration: 05:10 / 5.9 MB)
In This Episode:
00:45 – financial disadvantage
01:57 – totally off
03:15 – finger-pointing
04:21 – free stuff
Announcer: Sometimes, forex trading is a wild and wooly place to be. That’s why Hugh is here, to post your questions to Walter, the naked forex guy. Hugh’s got questions and Walter’s got the answers. Here at the Truth About FX Podcast.
Hugh: Hi, Walter. Somebody wrote in and asked: They’re having trouble finding a comprehensive educational package that will allow them to gain all the knowledge and necessary to trade successfully. But, what’s holding them back is that their financial situation hasn’t allow them to purchase anything, I guess is what they’re trying to say. What would you say about that?
Walter: They’re saying that still the currently financial disadvantage which is the only obstacle on my way. The real key here… And I know that this is going to sound like all zen-like and everything but it’s not the system, it’s not the information. It’s you.
Every trader who’s done this for a long time comes to the realization sooner or later — and it’s usually later — which is I am the key to the system. It’s you. You, the trader, that’s critical here. It has nothing to do with the system.
If you feel like you need to buy that $15,000 moving average crossover system, don’t. That’s not important. What’s important is you can go online and find plenty of… Well, heck! My book is available online for free.
You can get all my videos on eBay. It doesn’t matter. It’s out there. The information is out there. All you really have to do is find something that you’ll go, “Yes! That makes sense to me.”
That’s the key part. When you first read about or hear about or learn about a system, if you first think, “No, about that.” If it just doesn’t seem right, if it feels like it’s the wrong thing, then maybe you shouldn’t.
It could be that your intuition is just totally off and that’s the case when we first start trading. But, more likely, I think you should just gravitate towards something that makes sense to you.
It might be like trailing exit and taking really big profits now and again is what makes sense to you. Okay, fine. Or, it might be that having a win rate over 60% and having 1.5 reward to risk ratio strategy or something like that, whatever.
The important thing here is you focus on what makes sense to you and then from there, get good at it by practicing it and that’s free. You download a demo account and you can scroll back on MetaTrader and hit the F12 key and record your trades.
Go back and trade 2016, 2015 with that system using just the MetaTrader demo account and record all your trades on a spreadsheet. That’s free. You can get free systems. I’ve seen my webinars on sale on eBay and I know my book is floating around there on the internet for free but I’m not the only one.
There’s a lot of stuff out there in the forums. I would urge you probably don’t want to get locked in to the discussions that devolve into the name calling and finger-pointing on a lot of forums. Just take what you can and leave.
A lot of people are doing that. A lot of people are just kind of lurk in the forums and they don’t jump into the discussions. Just fine. Just go, get the information you like, find a system that resonates with you. Go test it, get your numbers up, see what your numbers are and then figure out if this is viable.
The way that I would do it is find a system then backtest the system in your MetaTrader and then once you go and get your average winner, average loser and win rate, you can plug it into the risk calculator that I’ll link up at the bottom of the show notes here.
The risk calculator will help you work out how much you should risk per trade assuming you’re going to use the fixed ratio position sizing formula which is what most traders do just like I always risk 1%. I always 2% or whatever. That’s what I would do.
It’s not about buying the most expensive system or anything. It’s more about building up your confidence. That’s where you’re going to get the biggest gains so don’t worry about paying for it in the beginning.
Find the free stuff and there’s plenty of free stuff out there that works, that you’ll like, and then just get your confidence up on that. And then later on, what you probably want to do is read more Psychology books. There’s plenty of trading Psychology courses out there which are great. That’s probably where you’re going to find the most value in terms of your progression as a trader.
Hugh: Yeah. That makes a lot of sense. Alright! Thanks, Walter.
Walter: Thank you.