I received an email from Ching Lu who wrote:
In the FXPRIMUS Oktoberfest Top Trader contest, the winner made a 4186.00% gain. How was that possible? Is it because the trader maximized leverage?
Your 90-day SMS trade made a 2% return – which is less but at least reasonable. Can you explain the difference between “% gain” and “return?” Thanks Mario.
Our winner achieved over 4000% in one month of trading. This is a fantastic result!
There are two reasons that make this possible in Forex trading:
1. In Forex, you can go Long or Short at any time. This gives a trader maximum flexibility to ride an ongoing trend or cut losses fast and take advantage of a change in market direction. If you know how to play the game, a 4000% gain is possible. At FXPRIMUS we practice strict money management (we do not risk more than 3% in any trade). We are conservative when we take trade positions since we are responsible for sending trade calls to members subscribed to our service. As such, we managed a 2% return in the past 90-day period.
2. The Forex Market saw tremendous volatility in the last month. This is due to the ongoing sovereign debt crisis in Europe, a slowdown in China and the upcoming fiscal cliff in the United States. In contrast to other financial markets, volatility is a Forex trader’s best friend because it allows capitalizing on sudden movements to make quick gains.
There is no difference between % gain and return. For example, if the starting capital is USD10,000 and the result is USD11,000, the profit is USD1000. Thus, the % gain or return is 10%.
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