As of 11/11/2019
  Indus: 27,691 +10.25 +0.0%  
  Trans: 11,030 -37.61 -0.3%  
  Utils: 830 -5.55 -0.7%  
  Nasdaq: 8,464 -11.03 -0.1%  
  S&P 500: 3,087 -6.07 -0.2%  
YTD
 +18.7%  
 +20.3%  
 +16.4%  
 +27.6%  
 +23.1%  
  Targets    Overview: 10/31/2019  
  Up arrow27,750 or 26,900 by 11/15/2019
  Up arrow11,300 or 10,100 by 11/15/2019
  Up arrow870 or 800 by 12/01/2019
  Up arrow8,500 or 8,000 by 11/15/2019
  Up arrow3,150 or 2,950 by 11/15/2019
As of 11/11/2019
  Indus: 27,691 +10.25 +0.0%  
  Trans: 11,030 -37.61 -0.3%  
  Utils: 830 -5.55 -0.7%  
  Nasdaq: 8,464 -11.03 -0.1%  
  S&P 500: 3,087 -6.07 -0.2%  
YTD
 +18.7%  
 +20.3%  
 +16.4%  
 +27.6%  
 +23.1%  
  Targets    Overview: 10/31/2019  
  Up arrow27,750 or 26,900 by 11/15/2019
  Up arrow11,300 or 10,100 by 11/15/2019
  Up arrow870 or 800 by 12/01/2019
  Up arrow8,500 or 8,000 by 11/15/2019
  Up arrow3,150 or 2,950 by 11/15/2019

Bulkowski's Forex Stats

 

Leverage Use in the Forex Market

How does the use of leverage affect profitability in the foreign exchange market?

This article is based on the writing of James Stanley in his article Three Rules to Risk Management as published in the July 2014 issue of Technical Analysis of Stocks & Commodities magazine.

When I read an author support his theories with statistics, I love it. Stanley did just that in his article. I'd like to share some of his findings with you.

The article is based on research conducted by FXCM.com. "FXCM is a registered Futures Commission Merchant and Retail Foreign Exchange Dealer with the Commodity Futures Trading Commission and is a member of the National Futures Association," according to their website.

The study included data from 2000 to 2010 on more than 12 million trades in the most heavily traded currency pairs. Here's what they found.

Table 1: Statistics
 Highest Equity  Average 
 Trade Size 
%
 Profitable 
 Leverage 
 $0 to $999 $26,00021%26 to 1
 $1,000 to $4,999 $30,00033%6 to 1
 $5,000 to $9,999 $54,00037%5 to 1

The above table shows how the use of leverage decreased as the size of the account grew. As leverage decreased, the percentage of profitable trades increased.

I wonder if this behavior trend continues for larger account sizes....

-- Thomas Bulkowski

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