Retail Forex Trading is a Negative Sum Game

Had my first article in a number of years published on the FXStreet mother site here today. It's a bit of a counter to another author's prior article, but also intended to stimulate some discussion. Definitely let me know your thoughts on the subject.

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Comment by Rhody Trader on January 18, 2013 at 11:45am


I don't know if I've seen any estimates on what is speculative vs. non-speculative in the inter-bank market. If I come across anything I'll let you know (the BIS survey figures may give some idea). The CitiFX survey from a couple years ago had something like 83% of participants saying they consider themselves speculators. It's probably even higher if you were to confine the answers to strictly retail traders, as I suspect there were some non-retail folks mixed in for that survey. Speculators tend to be much more active than non-specs (how often do you need to hedge, etc if you're a corporate or an investment fund?), so I think it's pretty safe to say that on the retail side we're talking well north of 90% of volume being purely speculative.



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