Wednesday, July 4, 2012

The Great Lies

Here are 2 of the great lies, debunked.
Exposing truth

1) The Stock Market has the best returns.
2) Forex is the Largest Market, and that liquidity will protect you

Reality--A good trader can do well in the S&P market, but 95% don't.     The S&P 500 is constantly replacing it's components to be the best of the field.   Since 2000, about 300 of the S&P 500 have changed.    That makes it look like S&P performance is good.    It encourages the buy and hold, the whittle you away with fees approach.   The blind faith until a 50% drop causes you to call your brokerage and say enough is enough - liquidate.  

It's a scam, well hidden for the most part. But the re-balancing of the components is where the real evil comes in.    The long term returns of the S&P are no where near where they are presented to be.

2) Forex is the "largest" market in the world.    You can be protected by all that "liquidity".  

Reality--Total bunk, and when you see pictures of cutesy girls sitting on the floor, trading FX on a laptop, doing a high five or silly indication that they banked coin, you can rest assured that market it being setup for a fleecing.    And fleece they do, I have seen stops of mine just completely "stolen" by, watching price on their software AND simultaneously watching price on Interactive Brokers, and not only did the price diverge from IB (in the direction towards a large stop I had), The price really never even got close to my stop and in the blink of an eye, they literally just stole my stop.   Don't trust those bastards.

Now back to the "largest market".      There is corrency moves made for legitimate business purposes, and indeed these are large, but the reported size of Forex markets is based upon most Forex trading at 100 times leverage.    A bet of $1000 is $100,000 on the forex market, and believe me if you place a bet in this "humooungous market" of $1000, you will instantly have computers targeting your stop, I have seen it in real life numerous times....its just like an antelope being dropped in the outskirts of a circle of lions.     Sheesh, they will chase your stop even for $200.


  1. So, What d you suggest?

  2.  Just don't buy into those lies
    And trade backtested proven probablilities
    And turn off the TV

    hows that for a start?


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