The learning cycle for a newbie trader

[issi1206]

great thread soultrader

[magpie23]

Originally Posted by bobnat

There is a concept in learning called scaffolding. It functions just like the actual scaffolds used in construction. This takes a long time.

Finally, think of it this way. If you do succeed at trading and it does take you 4-7 years, so what? Any thing worth doing takes time. I spent 10 years going to college to get the job I wanted. Think of any profession you want and point out how many of them can be learned in 1 or 2 years. Once I finished my education it took me years to work up the position I wanted, just like any profession requires. But, just like my profession now, I can do it for the rest of my life. The same is true for trading. If you succeed at it, it's yours for the rest of your life. You'll be able to make a living at it for 20-30 years. But you're going to have do it the old-fashioned way....earn it. That takes time.

Nat

One thing about trading that is very different to a lot of things, is that you're esentially on your own. There's no one to talk to face to face, if you're lucky your mentor will be on a phone (and costing a small fortune) - if you have a mentor that is.
I'll use learning a martial art as an example. How many people do you know that are accomplished martial artists learnt their skills from a book or the web?! not many (you'll no doubt hear of the odd one or two on forums...). TO truly learn there's two ways:

1. Go to a class where the sensei/teacher is recognised and accredited and practice at least twice a week, while keeping fit in the mean time. With some martial arts you can have a black belt in a short period of time (sometimes a year) if you really put the hours in, other arts usually take 3-10 years even with the extra hours.

2. buy the books, videos and go onto the web - then you have to find someone to spar/train with - in trading terms the other person is the market be it on a demo or with real money. Learning this way will cause you pain and will result in many more mistakes being made.

To my mind no. 2 is the reason so many people fail at trading because if you've an 'in the flesh' teacher, showing you the way to way to do things without hurting yourself twice a week in a dojo, your improvement rate is exponential in comparison to the guy learning from a book, who will spend a great deal more time with injuries, both mental and physical - if he can find a regular partner. ALso a teacher/sensei, having been through it all before and having him/herself learnt from someone equally competent will be able to break down complicated moves into easy bite size chunks that you as the student can fit together as time passes. There's also the interaction at the class, where one week your up against a big 120kg beast, followed by a nimble, fast and untouchable 50kg girl. You're automatically given many different situations to just 'deal with' but in a safe environment.
Maybe that's why the Turtle's did so well as a group.

It's also, interesting that the drop out rate for traders and people starting martial arts are about the same, only about 10% will still be in the dojo after a year.

I really believe though that my learning curve would have been a lot less erratic and a lot shorter had I had my own trading 'sensei' to go to twice a week.

Mind you, try and find a trading 'sensei' for $10 a lesson!

Magpie

http://nzmagpietrader2.blogspot.com/

[RedDuke]

Its is great for those who are lucky enough to find a mentor, but with so many sharks out there this is not easy. I do agree that a true mentor is definitely the most preferable option to start, but his/her absence should not be discouraging because forums like these can be a mentor if you know how to slice and dice the information posted here.

Regards,
redduke

[nuaing]

Hi, i was just browsing.. this is my first thread on this forum. Anyone here willing to mentoring me about forex trading?

[magpie23]

Originally Posted by RedDuke

Its is great for those who are lucky enough to find a mentor, but with so many sharks out there this is not easy. I do agree that a true mentor is definitely the most preferable option to start, but his/her absence should not be discouraging because forums like these can be a mentor if you know how to slice and dice the information posted here.

Regards,
redduke

how do you slice and dice the information?
For the newbie there's so much to take in, plus a great many differences of opinion. All adding to the confusion...
It really comes down to desire to succeed as the odds are very much stacked against you when just starting out. The desire to succeed is the only thing to get you through it as you're going to get pretty beaten up for a period of time, unless you're the one in a mllion that finds it all very easy.
To the bring the martial arts example back, you usually end up going to a dojo and seeing if the teachers style of teaching will fit your style of learning, they are usually recommended too or you know someone who goes - it's also a local thing with most people training with 10 miles of their home.
Nothing like this exists in face to face format in my limited knowledge of the trading world (unless working for a bank/hedge fund, or you've a huge wedge of personal cash to learn from a pro).
There's sharks in both the martial arts world and the trading world. The internet is littered with "my amazing system never before taught in the west can disable an opponent with your little finger, no training required just this expensive video"...
As you all know the trading world is even worse due to the splurge of the internet, and sorting the good from the bad is difficult and takes time.

So I suppose thanks goes to Moneytec and other forums, but mainly the traders that don't slate, flame or speak in riddles, but take the time to pass on their knowledge.

Magpie



http://nzmagpietrader2.blogspot.com/

[RedDuke]

I definitely agree that you need desire. On the surface trading seems easy, but in reality, it is one of the hardest professions out there. Trading successfully does not happen over night, it requires a lot of time, and very few are willing or can sacrifice tons of their personal time. When I began reading these forums and books my head was spinning, but over time, you learn what you are comfortable with, and take it from there. The key is not to give up.

redduke

[insomnec]

HI all,

This is my first post and after just browsing the forum for a while I'd say it's got to be one of the best.

I've been trading for about 4 years and I think I've barely made it to stage 3 (at least I hope I have).

After trading the ASX stocks, options, futures and options and many more instuments, fx seems to be the best instrument by far.

What's holding most amateur traders back from earning money, imho (I hate the term winning as it is too close to gambling), is their small account size. Meaning the proper stops cannot be employed.

I wiped my futures account out because my account was not large enough for my 2% risk model. Stops could not be larger than $ 1k on a 50k account. And whoever has traded futures will agree that 1k on a single cntrct is, most times, not enough.
That's where the fx comes in streets ahead of anything else.
What gave me the break through was the realisation that I did not have to make a fortune with every trade. I guess that's what has been said several times in this thread already.

So, me thinks, the advice given here before, that to trade small and accumulate till the acct is large enough to set proper stops, is a very good one.

I will keep reading this here forum and I thank all contributors from my heart for the fair dinkum, honest advice given so freely.

Thank you so much.


"Trading is all about probabilities"

[mach.25]

Thanks to bobnat and soultrader for their excellent posts. I have traded before with Options in AUS, too thinly traded. Also on the NASDAQ in the good old days before someone crashed aeroplanes into various US buildings. Did very poorly in options, quite well on the NASDAQ initially until all the volatility left that market due to the aforementioned event. But it was the lack of #1 education. #2 Not knowing myself more than anything killed me both times. Other people have succeded where I have failed in the past. This forum and the posts made by it's more experienced traders have convinced me that I can do this successfully. But most of all I am glad that most of are bound to make the same stupid mistakes that I have but can still succeed. Glad to know there is still hope for me. Not sure where I rank on the scale but realise that there is probably a long way to go. Living in Australia that doesn't really bother me.