From real transaction data of 95,617 people, considering whether "FX gets better with experience"

Continuing FX tends to naturally lead you to think this way.

“Even if you can't win yet, you’ll get better with experience.”

I thought so too.

When you lose, you look for the cause.

You review the charts.

You revise your rules.

You learn bankroll management.

You control your emotions.

As you accumulate experience like that, you gradually become able to win more stably.

FX, like work or sports, seemed to improve if you kept at it.

But the research I learned after quitting FX shook that premise even once.

Real trading data from 95,617 people

In 2016, Simon Hayley and Ian Marsh published
“What do retail FX traders learn?”
a study.

The subjects were95,617 individual tradersusing a certain online FX trading platform.

The period was about 30 months from January 2010 to June 2012.

Not a demo, but real-money trading data.

The number of trader-date combinations reached about 4.8 million.

One central question of the study was

“Do individual FX traders improve with experience?”

This is exactly the question I had scarcely doubted for five years.

Longer staying does not necessarily mean better

If improvement comes from experience,

those who stay longer should have better results.

But there is a problem here.

Those with poor results are more likely to quit midway.

So if you look only at those who stayed longer,

you might conclude

“the experienced are better.”

But you must separate whether

they improved due to experience, or simply because poorer performers quit early

from those who continued.

The researchers analyzed while accounting for these effects and differences in ability among traders.

No evidence that experience improves performance

As a result,

there was no evidence that individual FX traders improve their performance with increasing experience.

After adjustments, there was a slight tendency for performance to decline as experience increased.

This was quite striking to me.

For five years,

I thought,

“It’s just not enough yet.”

More experience would help.

More verification would help.

Better understanding of the market would help.

But the premise that “experience naturally leads to improvement” was not confirmed in this study at least.

Those who first win find it easier to continue

There is another interesting point in the study.

Among those who traded for more than 50 days,

39% were profitable in the first 10 days,

but only 13% were profitable after more than 50 days of trading.

The researchers note that

early good results may have motivated continued trading thereafter

to continue trading.

This resonated with my own experience.

I wasn’t losing from the start.

There were times when I could win.

So I thought,

“Maybe I can do it too.”

and kept going.

Not because I kept losing,

but because I sometimes won.

I think that was crucial.

Temporary wins and actual skill are different

In FX, you can win for six months.

You can win for a year.

That is a fact.

But

is that method sustainable long-term?

Was it just in sync with the market environment of that period?

That’s not easy to distinguish.

In this study, the EUR/USD during the period showed short-term mean reversion and multi-week trends, suggesting that there may have been strategies that were easy to profit with during that time.

So

you must separate temporary profits from reproducible ability.

I hadn’t done that well enough.

I won.

Therefore I improved.

That method would work.

It’s easy to think like that.

But a winning result alone does not prove long-term superiority.

This study does not say that no one can win in FX

This is important.

This study did not prove that

“No one can win in FX.”

There were 95,617 traders, a large dataset, but it was a study of users on a single trading platform.

The observation period was about 30 months.

It did not track every FX trader over a lifetime.

It does not deny the possibility that some traders can profit in the long term.

So I don’t think,

“Because of this study, I should quit FX.”

What I found important was a more restricted point.

Experience leads to naturally better results on average, but this was not confirmed in the study.

That alone gave me enough material to think about.

Questions I wanted to consider before “study more”

For five years,

I pondered,

“How can I become better?”

But now there is a question to place before that.

Is this really the kind of activity where genuine experience naturally accumulates?

How many years of practice does it take to improve?

Did those who became experienced really improve because of the experience?

To what extent should I tie temporary profits to my abilities?

This study does not give simple answers to those questions.

But for me,

it was meaningful to have a question beyond “study more.”

that mattered a lot.

Do not use years of experience as reassurance itself

“Five years of FX history”

“Ten years of FX history”

These phrases carry the appearance of experience.

But

long time spent at something does not mean performance has improved because of experience.

Of course, there is something to learn from those who have persisted for many years.

But

looking only at years of experience and assuming that person is skilled or that you will get better if you continue is something to approach cautiously

I think.

I myself studied quite a lot for five years.

But in the end I left the market.

So now,

instead of

“how long you’ve continued”

I focus on“what was really accumulated in that time?”

to see what remains.