FX Trading: Trap or Ticket to a Better Life? (2017 version)

Written by Jonbert Davidsen ∴ Friday, June 23, 2017

“Education is learning what you didn't even know you didn't know." Daniel Booratin

It’s amazing what ideas thrive online about what retail trading is. In reality, most are traps. Money-traps, transferring our money into someone else’s pocket. The marketers present the traps as tickets to a better life. It’s something I’m passionate about changing through critical questioning of what I see and hear online about retail trading. Last week I read a scam trading-story. How many people believe these stories? If we reduce the free material available online to high-quality material, material without Forex-commercials, we end up with nothing. The online community needs a more realistic retail trading approach. The online community needs more independent bloggers writing commercial-free trading material. I believe it will come. It’s a matter of time. Retail trading is a trap for the majority and a ticket to a better life for the minority. It is a compelling opportunity, though. But this irresistible opportunity excludes all but those who invest a significant amount of:

• Time • Money • Energy

into learning about the retail trading industry.

Do you know why retail trading is a trap for the majority and a ticket to a better life for the minority?
FX trading: Trap or ticket to a Better life.
Do you know why retail trading is a trap for the majority and a ticket to a better life for the minority?
FX trading: Trap or ticket to a better life.

Will a free Forex Tutorial Teach anyone to be a Successful Retail Trader?

Will a free Forex tutorial teach someone to be a successful retail trader? I doubt it. But if it does, good. Will a search on “what is Forex trading” turn anyone into a successful retail trader? I am sceptical. But it’s a start. As I gain more knowledge about how to evaluate trading material, I wonder why so many people keep visiting the same low-quality trading-sites? They search and share the same low-quality content again and again on social media platforms? Will this free trading material improve other people's lives? I question it. Instead, it’ll transfer money to the Internet marketers- and the broker’s pockets. When we understand how the industry works, we’ll be better to evaluate trading material online. It’s good because we can zip our pockets. Since I’m an Internet marketer, working with affiliate marketing several hours per day, I help others with trading material evaluating-methods.

Electronic Trading

Currency trading today is conducted on laptops, iPhone’s and PCs. What does this mean for a person who aims to be a successful retail trader? Lower entry barriers. Easier access. The trading has moved from “the floor” into the iPhone or the living room. It’s interesting that the movie-traders are still floor-traders. In IRL the movie floor-trader is an anachronism. Few question this because we can only issue what we’re aware of. The change happened without the public's attention. This YouTube-video about Chicago Trading Floor shows the old trading atmosphere on the floor. The takeaway here: The floor-trader is gone. Electronic trading has replaced non-electronic trading. The floor is empty.

Do you know why retail trading is a trap for the majority and a ticket to a better life for the minority?
FX trading: Trap or ticket to a better life.
Do you know why retail trading is a trap for the majority and a ticket to a better life for the minority?
FX trading: Trap or ticket to a better life.

Unbelievable

When people are under financial pressure, they have reason to be careful. It's easy to become naïve under such circumstances. Any story that’ll fuel the better-life-dream will sound appealing. Financial pressure people will be more eager to sign up than people who are happy with their economic reality. The Forex trader story is the most powerful make-money-online-story we can present to financial pressured people. Offer FREE access to: • Award winning trading platforms • Tight spreads • Quality executions • Powerful trading tools • Real time data • 24 hours support It’s the perfect money-for-nothing-story. The Forex trader story about skiing in Méribel, France, ocean surfing on the North Shore of Oahu, Hawaii or diving with sharks in Beqa Lagoon, Fiji while making money on the laptop/iPhone is the most famous online money-for-nothing story. But ask: Why would anyone give free access to: • Award winning trading platforms • Tight spreads • Quality executions • Powerful trading tools • Real time data • 24 hours support What it is we aren’t unaware of here? Several thousand sign up daily so they can push the button without thinking about this question.

An Absurd Idea

The whole idea about Forex trading for beginners trading with a Forex trading app while jogging in the park, skiing in Méribel, ocean surfing on Hawaii or diving with sharks in Fiji while making money on the laptop/iPhone is off the wall. The electronic trading from the iPhone has enabled the jogger/skier/surfer/diver to trade from the park. But how about the knowledge and education on how to trade? The online retail trading commercials represent a laughable money-for-nothing-idea. We’re tricked to believe trading is easy. We’re tricked to believe successful trading from the pool or the beach is achievable. What if the button-push is just 2% of the trading process? What if the 98% percent is hard work that requires financial and mathematical skills? It would result in different commercials. The jogger can obtain trader-success. But not by jogging and button-pushing while crossing the park. It’s hard to trade. Today’s commercials target people who are flat out unprepared to enter the electronic retail trading platforms. The marketers trick them believing what the trading ads say; they’ll be thrown into the wildest Manhunter-version they’ve ever experienced. But they dive in without hesitation. They’re under tremendous financial pressure. The trading commercials offer a financial future without any problems. Some may think they’ve taken the right action before sign-up. They’ve watched free currency trading video lessons. They’ve read blog posts. They’ve read markets update written by people who cover their real identities like in the Donald Duck comic book. For persons with financial education, these free trading sites are without problems. Some will even find them helpful. But it’s because their mindset is already trained to evaluate the information they see on these retail trading sites. They’ve learned it because they have read and listened to real people with real identities who have written real books. The guy with no financial knowledge, on the other hand, can get financially hurt from these free trading websites. Why? He’s unable to see the conflict of interest on these free retail trading affiliate sites.

How to Evaluate a Website?

In the end, we need to decide for ourselves. I want to share though, how I evaluate any site I use more than once a week. Since I’m an affiliate marketing guy, I need people to trust me. I sell my Tools for Lifestyle Freedom through other people’s thrust. I need to know how to find trustable people online. So here’s what I do. First, I head over to ICANN WHOIS to look up the websites I want to evaluate. To see the information, I need to remove the “/” at the end of the link. It’s a potential red flag if I get this result: Registrant Contact Name: Registration Private Organisation: Domains By Proxy, LLC Admin Contact Name: Registration Private Organisation: Domains By Proxy, LLC Tech Contact Name: Registration Private Organisation: Domains By Proxy, LLC In some cases, it’s unproblematic. For instance, I use Pat Flynn’s www.smartpassiveincome.com every second day because it’s my go-to site when I want blog-related answers. I know Pat Flynn is the owner. I respect him because I’ve received endless tips from him. Furthermore, I know how to get in touch with him. If I type in a trading site and I’m unable to see information about the website owner on ICANN WHOIS or on the website I want to evaluate, the situation is different. I would then question the site’s credibility and enter alert mode. I would consider why the registrant contact, admin contact or tech contact are set to private? If it were an FX trading site with a ticket to a better life for me, I would expect public information about the owner.  They could at least give me the possibility to send the thank-you-email once I’ve become a millionaire. I would expect the owner to be proud of helping others to achieve a better life through the information his website provides.

Why do People with Zero FX Trading Knowledge Sign up?

Why do individuals with no knowledge of the trading trade? Some find it appealing that Forex is the world's largest financial market. The magnet seems to be: “Big is best.” Others are, as I wrote, under immense financial pressure. It’s dangerous because these people fall for the FX-money-for-nothing stories. Many Westerners, myself included, worry about if our countries can afford to pay future pensions. We’ll have more people who live longer and fewer working people. It’s like two skis sliding away from each other. It raises the question about if the economy is strong enough to pay the pensions. Some FX trading sign ups come from people who want to secure their retirement. They want to establish a separate cash flow structure, which will enable them to live a life without depending on public pensions. A person who believes the question about the pensions is a real threat will live emotionally stresses. He or she needs to find a way to create cash flow before they can relax again. The FX trading story also appeals to these people. They need a story to hold on to so they can suppress the emotional stress from being financially insecure. Few who sign up for a trading account are willing to: 1: Pay for real education - because it’s too expensive2: Read high-quality trading books - because they need to pay more than $3,99 to access the book3: Aim for long-term goals - because they’re used to instant gratification. Real education is available. But it comes at a price few are willing to pay. Many will pay the $-amount. But few will pay the time-price. It takes a time to learn to be a successful retail trader. Free trading knowledge is the perfect trap because the ones most eager to sign up love the word FREE. Again, ask: Why would anyone give us financial knowledge for free enabling us to quit our job and make money? Is it realistic that this dream will come true just like this, BANG, for free? I believe in the financial-freedom-dream, but it’s a different idea than the one presented in the broker-commercials. As I have written several times: I believe retail trading is a realistic possibility for those who are willing to do whatever it takes. … and it’s a lot more than just pushing the button in Méribel, the North Shore of Oahu or Beqa Lagoon.

The Seductive Online FX Stories

Now and then we see stories on the Internet about someone smashing a small account up to millions. What is the purpose behind these stories? They’re often well-written. Last week I read Stock Market Millionaire is Making His Followers RichIt’s a (scam)story about a man who has been anonymous for a long time while trading on a social platform. At some point, he revealed his (right) identity as Harry Bell, and he was seen with a (Saudi prince,) the story says. The Saudi prince should have given Harry Bell the insider information that turned him into a profitable oil-trader. After he had got rich, he donated his wealth to charity. But he had also made those who copied him on the social trading platform prosperous. A good classic scam story. Stories like this cause people to lose money. They trick people to sign up for trading on social platforms. A well-known industry problem with social trading platforms is the high amount of fake profile; some say about 60-80%. By watching Anton Kreil’s YouTube-video about the retail trading, the readers learn more about this problem. Furthermore, can the website withstand the ICANN WHOIS-test? If we check the link, we get this information: Registrant Contact Name: Registration Private Organisation: Domains By Proxy, LLC Admin Contact Name: Registration Private Organisation: Domains By Proxy, LLC Tech Contact Name: Registration Private Organisation: Domains By Proxy, LLC The millionaire-story comes with no references. We hear a name in the article, Harry Bells, and a Saudi prince. Many people fall for this story despite the credibility-lack. They sign up at the article’s end, hoping they'll also get the chance. The stories about nickname-traders who turn $5000 into a million in five months trading from a beginners guide to currency trading pop up online all the time.

Do you know why retail trading is a trap for the majority and a ticket to a better life for the minority?
FX trading: Trap or ticket to a better life.
Do you know why retail trading is a trap for the majority and a ticket to a better life for the minority?
FX trading: Trap or ticket to a better life.

Financial Markets Regulations

Stories like Stock Market Millionaire is Making His Followers Rich plus all the other nonsense stories that lead to worldwide financial markets regulations. The United States and Belgium among other countries have banned Contract for difference, short CFD. The Wikipedia’s Contract for Difference article indicates a trend towards more regulations, not less. When the U.S. banned CFD’s, Jon Matonis, contributor on Forbes.com wrote:

I find this incredible. U.S. citizens blocked out a market that the rest of the developed world has access to. Of course, I am speaking about the CFD market. CFD stands for "contract for difference", and it is a marketplace where regular people can trade the markets of the large trading houses without the same capital requirements. So, basically, it is a form of democratised financial trading for the masses.

I understand what Jon Matonis says, but the price for the democratised financial trading is high. We should ask: Do ordinary people have any chance to trade the markets of the large trading houses without the same capital requirements with success? The affirmative answer is 10% will succeed. The negative reply is 1% will succeed. It’s irrelevant because It’s the other 90-99% who matters. Is it OK to allow retail trading if at least 90% lose their money? it’s the question worth considering. The 1-10% will be okay because they have the knowledge they need. The Wikipedia-article suggests, we’ll see future regulations. For the few, it’ll be a terrible event. But it’ll protect the majority from losing more money. It’s reasonable to assume better monitoring and regulations of markets worldwide since too many lose too much too fast. The question is when the regulations come.

Where to Learn More about Online Forex Trading?

Where to learn more about online retail trading is a personal matter. But we should be honest. With critical questions, we protect ourselves from being scammed. Ask: Will free-access websites with currency trading strategies turn us into millionaires? Ask: Will we find free trading strategies online that work? Ask: Will we find strategies on broker-websites that’ll turn us into successful retail traders? By identifying conflicts of interest between the: • broker and us • Internet marketers and uswe improve our chances of understanding the retail trading industry and perhaps become successful retail traders. Independent bloggers who write for new the retail traders are rare. Why? Because it’s much more profitable to write blog posts leading people to a broker sign up. I believe in changes as we see the markets get regulated.

A little Exercise

I’ll suggest a little exercise for my readers to train the critical sense while surfing trading websites. Go to a retail trading website: Forex, stocks, options, anything. Once on the website look for broker-commercials or trading-related products. The commercials will typical state something about opening a free trading account. Perhaps even offer a bonus to those who sign up NOW! When a broker-commercial appears on a website, ask: How does the website owner earn his money? Who does he help? You or the broker?

Sum-up:

I’m positive about retail trading as a ticket to a better life, but for the few. I dislike the easy access to retail trading because I see it as a trap. It will transfer money from well-meaning, honest, hard-working people into the Internet marketers- and broker’s pockets. Most people are better of skiing in Méribel, France, ocean surfing on the North Shore of Oahu or diving with sharks in Beqa Lagoon, Fiji with a ticket they bought for the money they planned to deposit into their retail trader account.

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