A warning for beginners trading forex on tradefair

by admin on 10 February 2009

Hi guys!

I’ve been trying to make some money on tradefair a spreadbetting platform run by the folks at Betfair, Hammersmith, London. For all u people who think they can make easy money on the internet – tradefair are currently offering a deal where u get £75 for free! (Email me if u are interested and I’ll give u more details on how to set one up – just use the contact form above)


So here’s my experience trading currencies/forex; the GBP/EUR pair on spreads.tradefair.com
I was selling pounds sterling and hoping that its value against the Euro would fall. For each “point” it fell I would receive £1 – for each point sterling increased I would lose £1.

My first trade on Tradefair
I placed a sell order on tradefair for sterling at 1.1452. The order was filled fairly promptly but quickly started to go the wrong way. This was my first trade and soon sterling was trading at 1.1460 – a loss of £8!
But I sat it out and the trade, after some yo yo ing up and down, went to 1.1449 – a gain of £3! I grabbed the gain!
My first trade had been successful!

My second trade on Tradefair
Again being a beginner without any defined strategy, I was just watching the tradefair bid and ask prices move up and down. I noticed that the price sometimes went up to test a new level but then fell down back down to a yo yo level. I decided to put in a sell order for a new level of 1.1460. Again i got the trade but it moved against me – this time by a worrying £12!
However I decided not to take the loss and just waited and waited.
Sure enough 20 mins later the price came back down again this time just to 1.1458 – I grabbed the £2. My account was now up to £80

My bad experience on Tradefair
I decided to try my strategy again. I put in an order to sell at 1.1469
Nothing happened; my order was not filled for hours – as the price kept yoyoing in the 1.1455-1.1459 level.
Then, while I went away doing other things, it filled!
Unfortnately my tradefair order filled during a sudden rapid steep climb in the price of sterling.
Suddenly I had lost £20!
That quickly became £30, then £40
….. it went down again to £30…
I thought I’d sit it out and hope it would reverse.

It didn’t – I lost again £50 .. then £60
But, I was patient, I waited hoping for it to reverse
At £64 something happened:
My Trade Disappeared!!!
It had been closed automatically. I blinked in disbelief!
I looked at my account valuation: I still had £20..
I still had money to cover more losses ….so what had happened?

Apparently tradefair have something called an “automatic stop loss”.
If your loss is 80% of your bank it can be triggered.
In my case I had £80 and had lost £64 – a loss of 80% so my
stop loss had been triggered – there was nothing I could do!

The really bad part is that my strategy would have worked. Had I been allowed to sit out the trade
(and I would have been if I had more money in my bank). I would have seen all my losses reversed and
even have been able to bank a profit of £20!

What’s the moral: Make sure you read and understand the trading manual before u risk your money!

{ 4 comments… read them below or add one }

Tradefair spoke person February 13, 2009 at 6:58 pm

I’m really sorry to hear about your experience on http://www.tradefair.com and to help you learn more about spreadbeting – we can offer anyone who reads this a free copy of Robbie Burns “Naked Trader”.

to get this book please click on the link below:-

http://www.global-investor.com/tradefair/

Happy Trading

Tradefair

sdsdfgsdfg June 16, 2009 at 8:37 pm

Fairtrade is extremely bad news, and will have caused problems for lots of people. Their interface is extremely attractive, and appears (on the surface) to be genuine, until you start to lose your money, and find that all is not what it seems.

Anyone with a bit of sense can make wins on the demo platform, and will find their balance increasing nicely. This is a clever tactic which makes you confident enough to add credit to your account.

As soon as you get into the live account, you’ll start to learn about the win / lose ratio, and the margins each side. Starting with a couple of losses can make you think that your luck will change, and that you will give it the benefit of the doubt.

You will experience a 5:1 loss ratio (consistently losing around £10, winning £2), and this will not improve. Dont sign up to this company. If you already have, get out now. The odds are against you.

This outfit is marketing aggressively, and will have a sales person calling you as soon as you setup your demo account.

Take my advice – try a different platform, and be very careful. And remember that the word ‘Trading’ in this context really means gambling.

Charlie C May 10, 2010 at 11:09 pm

“my strategy would have worked”
Not necessarily, it might never have gone back up to that price again. (Unlikely, but it may have taken a long time, or gone down more than £20

martin March 31, 2011 at 9:26 am

” The really bad part is that my strategy would have worked “. You don’t
know that . You think it might have worked . You certainly hope it would
have worked but you just don’t know.

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