First Survey from the OTA Research Center Begins to Dispel Myths regarding Retail Traders & Investors

Mike Richardson on Apr 25, 2021
In a first survey from the OTA Research Center in April 2021, over 1,200 of OTA’s students responded. These students had completed OTA’s Core Strategy Class, with a distribution of students ranging from new to just a few months to students who have been with the company for more than five years.  While students were not required to answer each question, those that did respond provided some key insights:

 

Students report that prior to coming to OTA, the majority had little or no experience. 70% said they had either no experience or were novices.

70% reported that they are trading live in the market (OTA encourages newer students to stay practicing in simulator mode), and 37% report that they spend more than 6 hours per week doing so, across a range of asset classes, Stocks, Futures, Forex and Options, with 83% reporting that they do not trade Cryptocurrency.

 

Nearly 2/3rds (64%) report that they are not day trading (intraday).  Nearly half (47%) report they are swing trading (few days to a few weeks), with another 17% reporting that they are position trading and long-term investing.

More than half say they spend more than 4 hours per week in their education, with 20% saying they spend more than 10 hours per week, predominantly spending that time in weekly online sessions with instructors and each other; 38% report that they are spending more time in their education since COVID but more than half (53%) report that they still prefer in-person classes (OTA is looking forward to reopening its centers)
 

In particular, the survey further studied student confidence.  After completing at least one course with OTA:

• 81% of students said they feel more knowledgeable about how the markets work
• 76% said they were more knowledgeable about how to manage risk
• 64% said they were more confident in managing their money
• When focusing on the key concepts of the Core Strategy methodology that Online Trading Academy teaches, respondents reported a weighted average score of 7.55/10 (75.5%) for understanding the concepts of Core Strategy and 7.37/10 (73.7%) for being confident in knowing where to set a stop loss;  Most importantly, 85% report that they created a trade plan (Online Trading Academy’s Core Strategy methodology teaches this as the first step of risk management, which is the foundation of everything it teaches). 
• 69% said they wished they had started their education sooner. 
 

When asked why students felt they were or were not achieving their objectives, the two most critical factors were “sticking to their rules” and “managing emotions”.

 

 

These data and insights into educated retail traders and investors are invaluable in beginning to dispel some commonplace myths about them, primarily that they are predominantly day trading the stock market, with simple buy, hold and hope strategies, taking untold risks.  These data begin to indicate otherwise, that the journey from novice to confidence comes from education, with sustained engagement, in a tailored methodology that embeds the disciplines of risk management.