Education is the key

[kenhetherington]

E-Trade, the world's largest on-line broker are right when they say that "most people lose money trading and that education is the key to success." Most people lose money because they have no system or disciplined approach.

Having been an equity investor for many years, I wanted to become more successful, and making profit and not losing it was sufficiently important to me, that I decided I needed some good education.

In a different context it is said: 'if you think education is expensive, try doing without!'

I decided to invest in decent training and it is working for me.

So my advice is, don't invest your hard earned money, or even worse your life's savings, without taking the time to learn how to do it properly and avoid making the fatal mistakes many traders make. There are good trainers out there, and I have no doubt plenty who are emphatically not!

Ken Hetherington

 

[SOCRATES]

That is absolulutely correct, but you see, there is a fashion for people to expect immediate results.
What is more is that there are many who expect to be taught for free, and what is even more there are others who like to trangress copyright by copying books written by authors without permission, and there are others who expect free copies of software having cost thousands to produce, and then there are those, who no matter what amount of effort is put into teaching and mentoring them will never succeed.
But those who are taught and mentored and are disciplined and responsibe and act within a moral framework and succeed are a delight to any tutor, and their peers.

MY very good wishes to you.

 

[Racer]

most people lose money trading and that education is the key to success

New traders are often successful... because they follow the market and go with the herd.
The more 'experienced' tend to think they know better than the market and fight it!

 

[kenhetherington]

I question whether new people are often successful, unless they follow a disciplined plan. But you are right , the worst thing you can do is to think you know better than the market!

 

[kevin546]

I think a simple method can work if it has been devised from correct knowledge of the market and not an incorrect perception. This means that time will need to have been taken to study the market correctly in the first place in order to be able to develop a correct plan. Knowledge is the main ingredient and You are the final component. Knowledge is one thing but unless you can command discipline to follow the correct method then trying to trade affectively is hopeless. IMHO.

 

[kevin546]

One of the main problems is knowing where to get the right information in order to become educated by another. But you still must develop this information around your own trading persona so that you can apply this information in a correct way that you are both confident with and capable of performing.

 

[Racer]

One of the main problems is knowing where to get the right information in order to become educated by another

Yes and sometimes the 'education' is not all it appears to be.. the person giving you the information can't succeed themselves so they charge others as it is an easier option!

 

[QQQShort]

As is true for many professions, traders must learn through experience which information is correct and relevant ... and which is not.

Af ter time, it becomes easier to figure other the data, products and vendors that belong in the rubbish bin. Likewise, our "experience-built" filters help us more quickly identify the tidbit of information relevant to our particular circumstances.

 

[DaveJB]

To expand on this a bit then....
I'd be interested in knowing what people think about the following -

I'd imagine a great many of us have trodden blind alleys on the journey, been suckered in at times by charlatans, been suckered in by some who earnestly but incorrectly believe they have the keys to the kingdom, paid for all sorts of books and programs aimed at improving our capabilities.... I see this as a hardening process, something that exercises my cynical muscles and gives me 'trading strength', a process where I accumulate over time, glacially almost, the skills I wanted on day 1.

I think the battle to reach this point has been very good education (and very entertaining, frankly) - so if somebody offered me the option of skipping back a few years in time and handing me a simple, profitable trading plan to follow I'm not sure I'd take it. I can understand the desire to skip some parts of the Darwinian selection process, but would we all like it on a plate if offered?

 

[kevin546]

It could also be that if they cannot succeed themselves then maybe they should not be educators in any event because clearly they have been unable to apply correct thinking to the market which could also imply they are providing others with the wrong information or only part of the equation because they never made it passed this level. Which tends to suggest those that they train are likely to fail also.

 

[DaveJB]

Possibly, although I'm not as convinced on that score as many are - here's why...
Whilst I'm not a great fan of psychology for traders, all those interminable periods of self examination whilst referring back to Elder and whatnot leave me cold, it does strike me that sombeody can have all the answers (so to speak) yet be too timid, or otherwise flawed, so that although they can display unerring ability to pick trades and so forth they are signally incapable of doing it themselves. If you were extremely risk averse you couldn't trade - but being risk averse would not mean you weren't actually any good at picking trade entry and exit, it'd just mean you couldn't do it for yourself.

A person like that could give you the technical training - they couldn't help you with any psychological issues probably, but that's a different ballgame. It also depends what level you are looking at - there's a place (in my view) for low cost training that ensures you have the basic skill set to actually trade - people who will help you decide on brokers, method of trading, picking the tools, and so on... somebody who will help you do the basic stuff so that if you do start picking decent trades you don't lose a packet because you didn't know about simple stuff like opening gaps, or whatever.

I would expect anyone charging me substantial amounts to be doing pretty well for themselves already.

 

[Racer]

You need to know and control yourself first.

 

[kevin546]

Part of the 'EDUCATION or CORRECT KNOWLEDGE of the market is the experience because you also have to experience yourself and how you react under certain conditions. That is why a good educator who has a very good plan may not be able to lead another to success because either the plan just does not sit well with that individual or they are just not suited to trading.

As to following plans provided by others I understand most who do well are those young and who possess little or no experience of the market. They perform well because having been given a set of rules they are more able to follow them blindly than someone who is older with some knowledge of the market because the 2nd group are more likely to be contaminated with wrong information and / or perception / experience while the 1st group have no trading baggage to re-direct there thoughts elsewhere. I think the exercise with the Turtles proved this theory.

But it follows they still need correct information, rules of the market to follow so it is evident the person providing the information must be someone who has traded successfully over a long period rather than just a short period where they may have been successful for no other reason than they caught a bull or bear market. A successful traders needs to be able to survive in all markets or be aware to stay out at the appropriate times.

 

[kevin546]

I accept someone who cannot trade for themselves may prove to be an excellent trade for someone else if they knew any losses would not be held against them and the taking of profit was left to someone else.

However when training they would only be able to provide part of the answer and they trainee would be confronted with emotions while trading and may not have prepared his plan to adequately cover this area. Without it this plan is likely to fail and comes back to being able to know yourself and control. The method has to take account of this which this tutor unless very very honest will not direct you through this tunnel of learning. IMHO.

 

[SOCRATES]

My current view is that why should you want anybody to teach you anything considering the amount of talent there is on this website and how everybody shares, and how much information is available free.

Your obvious route must be for sharing to take place between members which is the popular consensus.

 

[kevin546]

Socrates

Are you playing devils advocate.

 

[jimmy1jag]

- so if somebody offered me the option of skipping back a few years in time and handing me a simple, profitable trading plan to follow I'm not sure I'd take it. I can understand the desire to skip some parts of the Darwinian selection process, but would we all like it on a plate if offered?

The immediate reflex response from someone at the beginning of the learning to trade process is, "Yes!"

However, if I look back at my own career from the green days 10 or so years ago, I realise that things are different. At the beginning, I was taken step by step through the change management process. Join the dot consulting (my job) if you like. However, learning the technical part, if you're perfect at it, only accounts for 20% of the whole. The other "psychological/ tactical" part accounts for 80% and can only be learned through experience. As a result of that experience I generally feel strong and confident in my job- even though I do still occasionally fall flat on my face. Through experience you build the required understanding and persona to do the right things the right way.

I was lucky in a way in that I had over 2 months at the start of the year to dedicate to concentrated learning of trading. Of course this isn't nearly enough (even at 12+ hours a day 6 days a week). I realise now that I have only touched the tip of the iceberg. There is still a huge amount to learn. Patience, perseverence and discipline are the key things I guess.

 

[SOCRATES]

Yes I am.

The obvious route is insofar as trading is concerned not the correct route.

But people persist in trying to shortcut everything and anything that requires attention and dedication, particularly if it takes a long time, and moreso if it requires sustained effort, patience, persistence, and self governance of the highest order.

You are asking people to do several things which individually they find difficult and collectively, except for a very few, nearly impossible, as you are up against the human condition.

Also sharing works in everything except this.

This is because the trader has to change himself in order to come to terms with what he faces.

But, this is not what people want to or are disposed to do.

The popular concensus is to share, the obvious route, as lonliness is uncomfortable, indeed unbearable for some aspirants, and there lies a major trap as well ,all of this for starters, but of course there is more, much much more than anyone who starts can begin to imagine, and then, it gets easier, and then easy, and finally, a doddle.

 

[kevin546]

Socrates

I thought so.

A realisation and more importantly an acceptance of the contents of your post is one of the stepping stones to correct knowledge of the market. You can pay a very heavy price if you attempt to shortcut correct trading knowledge.

 

[DaveJB]

Kevin
yes -

ever when training they would only be able to provide part of the answer and they trainee would be confronted with emotions while trading and may not have prepared his plan to adequately cover this area.

... and the emotional side is for you to sort out, not (in my view) something to be taught... which does not stop people flocking to those offering courses in amateur psychology.

Racer - also agreed, but anyone who hasn't a reasonable grasp of their own character should have the sense to keep out until they do. This is a difficult enough area of endeavour without lying to yourself as you go through it.