Most articles I have written over the years of doing Lessons from the Pros have been mainly focused on highlighting various aspects of successful trading, ranging from trade plan formation, objective technical analysis, risk management techniques and even mastering the inner mental game. The list is pretty extensive. Each article either myself or a colleague has written is simply there to help both active traders and complete novices to better understand what it really takes to become consistently profitable in all market conditions and more importantly, to preserve their capital at all costs. I hope that these snippets of information help people to get a better idea of what we do at Online Trading Academy. I know that thousands of our readers have gone on to visit one of our many worldwide schools and enroll in our lifetime education programs, eager to begin their own journey towards trading success in the best possible way. I know how these people feel, as I too was a student of the Academy many years ago.
Having been through the education process and having developed my skills to become an instructor myself, I will always be the first person to say that anyone out there who is serious about trading and investing and wants to have the greatest chance of making it work, simply must get themselves educated without exception. For most however, this is not the case. Many try and go it alone, thinking that they will pick it up over time and after they have bought a few trading books or done a little research on the internet. Let’s face it, the prospect of making money on a daily basis just from clicking a few buttons is a highly attractive one to the vast majority of people out there, yet so many fail time after time. I would like to explore why this is, because if you are genuinely considering putting your hard-earned cash into the market, you need to understand fully what to expect or it will be taken from you without a second thought. That is the nature of trading for the uneducated.
Here are the facts as they stand: Around 90 percent of retail market speculators trading today are losing money, meaning that around 10 percent out there are making trading work. For most people when they learn about this rather harsh reality, they have one of two reactions.
1 – “That can’t be true…I know more people are making money at this and I’m going to be one of them!”
2 – “Wow I didn’t realize trading was that tough…if so many people lose, how can I ever hope to make money?”
Thinking back to when I first started getting into trading and learned of this, I remember very clearly leaning towards reaction number 2. I was almost scared off by the fact that so many people lose money in trading. However, something that was said to me by my own mother many years before changed my way of thinking. She always liked to remind me when I was growing up, that if I did what everyone else did, then I have to expect to get pretty much what everyone else gets. You see it doesn’t really matter what you think about these statistics at all. You can be scared and put off by that number of failures which retail speculators endure, or you can choose to instead face the challenge head on and jump into the choppy waters without any kind of support. Needless to say, I believe that it is far more important to step back and understand the actual reality of why 90 percent of people face such huge challenges in their trading, because if you begin to understand why others lose, you can then start to avoid their mistakes and do the opposite.
For a start, I was lucky enough to be taught, mentored and spend much time with some of the very best traders on the planet. One thing which they all have in common is they admit that they never know what is going to happen next and they accept that trading is really a very simple thing to do. It is just human emotion which tends to get in the way. By learning what not to do, then forming a rule-based approach to the market (which gives you objective trades of a low risk, high potential reward nature) and then following a plan with disciplined risk management practices, anyone should be able to make trading work for them. Yes, I know it sounds too simple, but it is. The challenge in trading comes from the place we least expect: our mind. If you want to be good at something you need to do two simple things. Firstly you need to learn how to do it well, then secondly you need someone who already knows how to do it to coach you ongoing. Is this not how we learn in school and at University? We learn, we practice and then do it ourselves whilst we are monitored and supervised by those who know better and who taught us in the first place.
So why is it that so many people balk at the thought of getting an education in trading then? For some it is the obvious choice and only option to get the right help with the right people, but for many others it seems that the reluctance to get the education always takes precedent. I have thought about this many times over and for the most part I believe that it comes down to nothing more than simply accessibility. Remember what I said at the start of this article? 90 percent lose at this and 10 percent win. Think about trading like any other profession for a minute. How many top musicians, sports people, engineers, doctors, lawyers, scientists and artists are there in the world right now? Probably around the 10 percent if we had to call it. These individuals trained to learn to do what they do to the highest level and had mentors and coaches available to them to support them on their journey and to motivate them to the next level of success. Do you think that benefited them in some way? I would like to think so. They had to study at the right institutions before they could even take up their profession as well and before they even got accepted for their training they no doubt had to qualify!
Now think about trading. Is this something that requires a natural talent or a gift for seeing into the future? The last time I checked I hadn’t heard of a crystal ball that actually worked! Trading is about knowing what to do, when to do it and following your rules…period. It needs to be studied and learned yet does not require any pre-ordained gifts. Anyone can do to it, as long as they have the right education and the right support. People simply do not get the right start because the door to trading is always open to them. They can open an account and read a few books and be clicking buttons anytime they like. Nothing is stopping them at any time. Yet before you can take up a job in any one of the professions I mentioned, you have to get the qualifications in the first place. The door will always be shut in your face unless you have the right training. If this makes sense to you and you are about to start your own journey into the world of trading , then please sit back and take stock. Are you fully prepared? This can be the best venture you could ever get involved with but only if you do it right. Knowing why most people fail and not making the same mistake yourself is half of the journey to success after all!
Have a great week,