The Self-Education of a Speculator
As a full-time trader, I don’t have a typical job. I have a 5-second commute to my home office. I wear t-shirts to work! There is no boss standing over my shoulder, and the actual trading hours require a relatively brief daily commitment (6.5 hours) as compared to other occupations. And I’m thankful for all of it.
The market closes at 3pm for me, offering lots of time to tend to other things – if I so desire. However, my desire is to succeed at trading for the long haul, which means I have lofty goals. In turn, I’m not the type to walk away when the closing bell rings. I work at it every day to improve and educate myself on an ongoing basis. I have to stay sharp.
That means I’m reading books, blogs, spending considerable time working the charts in search of what’s working best right now, and of course reviewing my own trades in order to continue learning.
Because successful trading is so much about finding a style that fits your own personality, it is only fitting to investigate what styles exist. An energetic and impatient person may want to become a scalper, looking to day trade quick moves within a short timeframe. A laid-back trader may prefer a less-intense style like swing trading, taking positions to hold for days or weeks. There are many approaches to the market, and finding your own style can come as a result of identifying with the style of another trader.
Raising Your Awareness
The road to expertise isn’t a short one, particularly in trading. I’ve been at this long enough to be considered an expert, yet there are still plenty of days where I’m reminded that I sure don’t know it all! Trading will humble you like that, but that’s part of it. Regardless, here are some ways for you to get educated as you further not only your knowledge but your trading career in the process.
Books.
I’ve read a couple hundred of them on trading, and while there’s plenty of worthless paper out there, you can still find some great ones with timeless lessons. I think it’s important to continually seek out information, whether it’s new and applicable now or just a lesson to be reminded of (before the market does it for me!). Your self-motivation will help you improve, so dig through the classics for starters. Mark up the margins, underline the parts which resonate with you, and return to them often.
I particularly like the Market Wizards books by Jack Schwager. He profiles traders in all kinds of markets (bonds, equities, options, futures, mutual funds) and of all timeframes. Yet despite their differences, all are highly successful. The interview format he utilizes gets you in the minds of these great traders, offering countless lessons. (I regularly visit TraderInterviews for the exact same reason). Every good trader trades in accordance with their personality, as we all should.
The newest book I would highly suggest is One Good Trade, which is the best trading book I’ve read in a long time. Bella covers it all and overlays his lessons with a variety of trading characters (based on real people), which helps drive the lessons home that trading is all about performance, adaptation, learning, and having the right mentality. Once I started it, I couldn’t set it down, and I’ve re-read it since.
Blogs.
Reading posts like this one can’t help but to expand your knowledge and open your mind up to some new possibilities. There are countless blogs on trading, but there are some good ones. Hunt for those which offer whatever it is you’re lacking….encouragement, psychological lessons, trade reviews, sector snapshots, news on industry developments, interviews, trading videos, etc.
If you’re willing to get honest with yourself and figure out what you’re lacking, you can find some blogs to visit regularly as resources. Just be sure they’re written by traders, honest, and not wasting your time, as there’s no shortage of distractions out there that won’t help you grow at all.
Results.
If you don’t track your own trades, start yesterday! You can record your trading via screen-capture software, but even a journal or simply a grid outlining entries, exits, holding times, patterns, trade context and objectives will shed more light on your trading than you can imagine. As you collect results, start to compile them. I did this for the first few years of my trading, until I really understood what I was doing, and it helped me assess my strengths and weaknesses. Monthly, I’d review my results and calculate statistics which gave me plenty to work on.
You just can’t argue with data! Getting mixed results? It may be time to make an adjustment. Figure out how your wins and losses stack up against each other, as that’s a great starting point. Over time as you endure periods of profits and pain, you have stats to compare against and you can more readily see when something is out of line.
Premium Services.
I’d be leaving a huge part of the mix out if I ignored premium services in the education process. Early on, I subscribed to a number of sites while I figured out my own style. Once I got to the point where I had my own opinion, I knew I had learned enough to need them no more.
Here at TheStockBandit, we offer a nightly stock pick service outlining my own trading plan for tomorrow, which some use to generate trade ideas and others use as a learning tool to see why I plan to take each trade (since each are explained).
We also offer stock trading courses in a video-on-demand format. The trading courses explain everything I know about trading, making them an incredibly valuable resource to return to over and over (depending upon current conditions in the market), helping traders see a huge variety of trade types and which kinds of market conditions are well-suited to those plays.
And while I’m certainly proud of and stand behind what we offer, there are plenty of others to choose from which are produced by legit people with a lot to teach you. If you want to accelerate your learning curve and truly build your skill set, let someone help you who has done it.
You Get What You Give
If trading is your job or a part-time endeavor you’re passionate about, recognize that your level of effort in the growth process is going to be reflected in the results you get. Be willing to apply yourself regularly as you learn more about not only the market, but yourself.
Staying educated and keeping a learning mindset is going to eliminate mistakes as well as some big disadvantages you currently face if you’re halfway new at this. As you make that a habit over time, it’s going to continue to pay off in a number of ways. Become a complete trader and commit to educating yourself. You won’t regret it.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
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