There are a few kinds of tips in Forex. I prefer to categorize it this way, please share your opinion:
- Free tips: Normally it is a tripwire, tips for free in exchange of reputation and/or traffic. From reputation and traffic, a website makes money. An example of this is all broker websites offering free analysis, daily to you, newspapers, blog, YouTube, Facebook group, Twitter, etc.
- Pay tips: This is something more serious, you pay like 30$ or even more for monthly subscription, then the tips can be sent to you by SMS, or by mail. Just search for ‘Forex signal’ then you can have a lot of it.
Just make sure you only subscribe when you see that the owner of the subscription also live trades what they send you. It is nonsense that they said you should buy EURUSD but they did not dare to do so in their own accounts.
The next level of this pay tip is to copy the signal to your account. This is better since you can see that the owner of the tip is trading and he just gets extra income for selling you the signal, so you can follow. In this case, a good signal provider should have a large account. This is nonsense that your signal is so good but your account is 1,000$.
That is the theory, however, it is not that easy to copy someone’s trades and get profit. The problem is, and always is, that when critical events happen, the signal provider is lost; some survive (around 4%) but to be in that 4% requires a lot of skills, experience and gut to deal with big events. At that time, signal providers cannot take care of followers’ accounts as he can only try his best when surviving is hard enough… I mean extremely hard!
Look at this top signal provider in the world; their drawdown is mostly above 30%. Imagine we have an account of 100,000$ following them, when they are floating lose 30% of their account, they may know how to cover back through so many ways, but we as a follower don’t know what to do with 30,000$ red in our accounts. Close it? We will panic, blame the signal provider and disconnect from him, and now we are on our own, dealing with 100,000$ of our own money and 30,000$ floating red. Most probably we will lose all 100,000$...
I have changed you to we, so as not offend.
Regards,
Will Vu - Forex Investors since 2006
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