Trading Schools

[roztom 10]

what steps did you all take before you actually started trading? so far ive just been reading (a lot), hanging around freestockcharts.com and watching some videos. if you were to make a list, what should one learn about before he actually starts trading? like 1)technical analysis 2) indicators 3) brokerages, etc etc.

 

edit: i worded that pretty sloppily haha so just to clarify things, if one were to systematically learn the basics of trading and build a base for their knowledge, what would they have to learn?

 

I think everone should try to answer that one..however - there might really not be a specific answer or path... I'm not trying to be vague here..but it is an overwhealing question to try to answer...

 

Without trying to pass this off to someone else, there are posts on the site that try to articulate the process it is something that takes many of us years to master with much weeping and knashing of teeth along the way...

 

This is a very high skill endeavor and it requires 1,000's of hours of screen time if you want to be a daytrader.. now I am a futures trader - most here probably are... you do not have to start that way as far as instrument to trade & risk..in fact today they have simulators so you only have to risk your time and not your $...

 

The trading process is basically generic (not including the idocincacies of a specific product - anybody ever trade Pork Bellies :helloooo: ).

 

Basic Trend Following and Bar Charts are not a bad place to start... Basic concepts like Support & Resistance. Understanding what & where a profit target might be, defining when a trade fails and what the risk is to find out if you're right...

 

Basically when you put on a trade you are paying for the opportunity to find out if your hypothesis is right - price of admission to the game.. in reality you need to see a trade as a coin toss, 50/50 with a random distrubtion of outcomes with hopefully an edge that skews the data in your favor. Then you MUST consistently execute your edge. An edge can be just ONE repetitive setup that you have complete confidence in, that you have tested and shows up and has a probability of succeeding more than 50% of the time - in other words not random...60% would be nice or more... but anything that skews the probabilities your way, over time, if you can execute it consistently will make you $.

 

DO not worry about indicators..that only adds complexity - plenty of time to open Pandora's Box... start out simple... I started with a end of day chart book, ruler and pencil. Took a Bar Charting Course at the CME and bought a book on Bar Charting by Edwards & McGee... considered by many to be the bible of Charting... there are many good books on it but that is the classic... This is just how I started - not saying that you should approach it like I did. Back then there was no internet or online charts, etc... but I did learn and lost a lot of brain cells along the way. :crap:

 

Many compare this business to being a fighter pilot.. I think that might be accurate... the timeframe you choose to trade in will determine how sharp your skills need to be, IMHO...

 

YOu do not need to swing for the fence - job one - survive the learning curve.. you are trading against potentially the Goldman Sachs and Michael Jordans of the Trading World, MBA's, Research Dept's, High Frequency Trading Bot's, High Speed Computers, Hedge Funds, etc. You get the picture.

 

Keep in mind where you are on the Financial Food Chain - right near the bottom...

 

Trading is not an ATM that anyone can unlock - quite to the contrary - yet many try...

 

This is not saying you shouldn't try - but you must be a realist. This IS THE JUNGLE and while we may be hunters - many of us become the hunted...

Edited March 27, 2012 by roztom

[karoshiman 10]

 

...

 

This IS THE JUNGLE and while we may be hunters - many of us become the hunted...

 

 

 

Tom,

 

I didn't know you have a poetic side... just kidding!

 

Great post!

 

k

[gosu 10]

what steps did you all take before you actually started trading? so far ive just been reading (a lot), hanging around freestockcharts.com and watching some videos. if you were to make a list, what should one learn about before he actually starts trading? like 1)technical analysis 2) indicators 3) brokerages, etc etc.

 

edit: i worded that pretty sloppily haha so just to clarify things, if one were to systematically learn the basics of trading and build a base for their knowledge, what would they have to learn?

 

This is a good question. I won't provide a list but just the extremes of what I think are the possibilities in the learning spectrum.

 

The best way to learn to trade is to come into it with an open mind with no preconceived notions and get together with an expert who can get you from ground zero to being operational with no risk to your own capital, usually by the expert making up all your losses while learning. The displays to see the market, the tools to annotate and the vocabulary to describe its movements are all set up for you. Your sole object is to follow his instructions and do what you are told. The learning progression would start with drilling how to flawlessly enter and exit the market with no loss and then on to anticipating and executing the gimme opportunities as they arise. This gets you to operational and you can then survive to continue gaining knowledge, experience, and skill in order to increase your participation.

 

The worst way to learn to trade is to come into it after much exposure to conventional wisdom and then look to obtain "education" that just reinforces your preconceived notions. Almost always the education does not reduce the risk of loss associated with learning and is a sunk cost. It usually consists of dumping a method or a system onto the learner with the standard caveats of keeping losses small, letting profits run, having more winners than losers, etc. More recently, trader psychology is the focus wherein a particular method or system is not provided but a way to handle "uncertainty" usually by focusing on the trader without regard to the market. In either case, the educator may or may not know how to trade.

 

Obviously the best way is unavailable to most if not everyone starting out. Still I think it's good to have an idea of what the best could be in order to move toward it and away from the worst way to learn which seems to be gaining increasing acceptance as the path to success.

 

This is just my opinion, of course.

[Mysticforex 13]

This is a good question. I won't provide a list but just the extremes of what I think are the possibilities in the learning spectrum.

 

The best way to learn to trade is to come into it with an open mind with no preconceived notions and get together with an expert who can get you from ground zero to being operational with no risk to your own capital, usually by the expert making up all your losses while learning. The displays to see the market, the tools to annotate and the vocabulary to describe its movements are all set up for you. Your sole object is to follow his instructions and do what you are told. The learning progression would start with drilling how to flawlessly enter and exit the market with no loss and then on to anticipating and executing the gimme opportunities as they arise. This gets you to operational and you can then survive to continue gaining knowledge, experience, and skill in order to increase your participation.

 

 

Excellent! The ways things were done many years ago. If a young person were fortunate, they might be able to secure an Apprenticeship. Apprentice carpenter, smith, plummer, etc. Their futures would be secure, knowing they would always have work.

They would have a skill, a craft. A Tradesman.

[wrbtrader 10]

what steps did you all take before you actually started trading? so far ive just been reading (a lot), hanging around freestockcharts.com and watching some videos. if you were to make a list, what should one learn about before he actually starts trading? like 1)technical analysis 2) indicators 3) brokerages, etc etc.

 

edit: i worded that pretty sloppily haha so just to clarify things, if one were to systematically learn the basics of trading and build a base for their knowledge, what would they have to learn?

 

• Money Management
   
  
• Position Size Management
   
  
• Stress Management
   
  
• Intermarket Analysis involving how other key markets impacts the price action of whatever it is that you're trading.
   
  
• Trade Management involving all that stuff that occurs after entry.
   
  
• Strong understanding that profitable trading involves much more than just trade signals.
  

[MR. JEEZE 10]

Hello Baker:

 

I am a fairly new trader so I can tell you some of the beginning steps I took.

 

1. Choose what you want to trade. For me it was futures, the e-minis to be exact.

 

2. From there I chose a broker who dealt in my chosen markets (I won't mention any names as that appears to be a no-no) but the broker I chose offered a free demo of their trading platform. I think the free demo thing is pretty standard for many brokers. The demo included real time data feed for those markets. The next step was learning how to use the platform to execute trades. Their service provided various aids like webinars and videos to demonstrate the use of the platform.

 

NOTE: Although I am a "low-poster" I swear I am not a vendor and I am not promoting this broker. I am only answering a beginners request for a check list of possible considerations to get started.

 

3. Next I selected a charting service so that I could start getting the screen time that everybody talks about. Let me take this opportunity to chime in with the masses. Screen time-very important. There are many choices when it comes to charts and it may depend on the market you choose and the types of data feed you require. For example I have heard that NinjaTrader is free for simulated trading but I think you still have to pay for the data feed for the markets you select. Someone correct me if I am wrong about that. One of the most popular packages out there is Trade Station which is actually a trading platform and charting package combination. But it is a bit pricey unless you have a funded trading account with them AND do a certain number of live/cash trades per month. I do not reccomend this if you are just starting out. There are several more choices out there and the folks on this site will be happy to help once you are ready for charts. I selected a charting company that also offered a free trial and the data feed was provided by my broker. So up to this point everything has been free, for a couple of weeks anyway.

 

4. This is where I realized I knew less than squat and I needed help. Like you, I started looking for courses and ways to learn how to trade. When I started seeing some of the price tags like 5k, 10k, 26k! I was shocked. After some searching I did manage to find a course with a more manageable price and I would reccomend something like this for someone who is just starting out. Personally I was never exposed to trading, never knew anyone who traded and had no idea of what "IT" should "LOOK" like so watching someone work with the charts, add/remove indicators, point out various patterns and potential set-ups etc. was very helpful to me. From there I was able to develope a trading system that suited me instead of trying to trade someone elses system.

 

I hope this reply has not been too basic but you only mentioned reading books so if you have already done the above then perhaps this will help some others who are just starting the "journey".

 

Good luck to you.