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Pursuing A Trading Education

As many readers are probably aware, I am a great believer in advancing my trading knowledge and advocate ongoing trading education for anyone who wants to become and remain a successful trader. During the last week, I had a short dialog with a subscriber on the blog who adamantly takes the position that he is going to learn for himself. Good for him! That is what I did and that is what most traders must do. However, the subscriber further explained he wants nothing to do with books, seminars, coaching, DVDs, or services that are sold. I am not sure what that means except that he is going to the school of REALLY hard knocks. I have no idea how much money this person has to risk, but with an attitude that he can do it without assistance from those who have gone before, my bet is he won't have it long. It's a little like deciding to be a doctor, but not be willing to put out the cash and effort to attend medical school -- potentially hard on the patient -- and in this case, the subscriber is his own patient.

I remember when I first became interested in trading. I at least bought a book and that piqued my interest which led me to attend a free "come-on" seminar where I knew I would be solicited to pay for a more comprehensive seminar. I went to the free seminar fully determined not to pay for the seminar being sold. Thankfully, I re-thought my decision and did pay for a two and a half day seminar. I made back the cost of that seminar within a week using information I had gained at the seminar and from that time forward never hesitated to pay for my education. It was far less costly than trying to get everything for free. Though I speak at events on occasion (usually without pay) I no longer give seminars so I am trying to sell nothing when I say that the many I attended have helped me succeed as a trader. Without them, I might possibly have been out of the trading business years ago.

In my own case, I read every trading book I could get my hands on, watched umpteen VHS and DVDs, and still attend seminars with some regularity. I read several trading books a year. In short, I make sure I devote substantial time each year to enhancing my knowledge. I know several would-be traders who, like the subscriber, absolutely refuse to pay for any educational information regarding trading. Not a single one of them has been successful and most lose their trading money within the first six months. Education only makes good sense and why shouldn't the educator be paid? Should you buy a stock, for example, if you don't know how you might limit or remove risk? Would it be helpful to know a strategy that will make you money if the market or the stock moves in either direction, just so long as it moves? Though not currently the case, would it be helpful to know strategies that provide a nice return in a flat market? How likely is someone to stumble upon these things as a new trader unwilling to read a book, go to a class or watch a DVD?

I realize I'm probably preaching to the choir here, but when I see folks like the subscriber who evidently resents authors or lecturers and begrudges them payment for passing on their knowledge, I feel a need to reiterate that successful trading requires work and study, it does not come from bull sessions with other unsuccessful traders. Serious trading, in my view, requires a foundation of knowledge first and then the acquisition of experience. Trading real money before obtaining the basic knowledge seems like a perfect recipe for failure.

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Good Trading!
Bill Kraft