According to our programming insider, about four months ago a couple of dealing desk Futures Commodity Merchants, specifically dealing desk brokers, conducted a joint, private study of Forex trader behavior. What they came up with only confirms what David Hannum, owner of the Cardiff Giant, one of PT Barnum's competitors said - "There's a sucker born every minute." 1. 98% of dealing desk traders open accounts with exactly $1,000.
2. The vast majority trade using 100:1 or greater leverage.
3. 42% of these traders return to the watering hole four times adding a additional $1,000 to their account each time.
4. Midway through their final shot at trading, they throw in the towel, closing their account only to return home with an average of $400.
Now what does this tell us about the quality of education the average trader is receiving? I may be way off base here (won’t be the first time) but I’m guessing that the vast, vast majority of those who fail make two fatal mistakes. First, they choose to trade with a dealing desk broker and, second, they rely on the very same broker to train them.
It doesn’t take a degree in mathematics or psychology to figure out what’s going on here. Dealing desk brokers are obviously not as interested in teaching traders how to stay in the game as they are in encouraging irresponsible trading and attracting new clients.
So what's the solution?
Get your education from an experienced trader who not only isn't affiliated with a dealing desk broker but is intimately familiar with the games they play.
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