Forex training. Is education worth spending money?

Forex training. Is education worth spending money?

I want to share my experience. I started Forex trading in 2005. Then the markets were rather active. The draft EU constitution wasn’t approved first by France, on May 29th, 2005, then by the Netherlands, on June 1st, 2005. But there had been the information about France and the Netherland's rejection of the new draft constitution a few weeks before the polling day, and EUR/USD chart was steadily going down. At that time, I first learnt about experts’ forecasts and found my first teacher in trading. To the credit of analysts, most of them predicted that euro would devalue, and dollar grow stronger.

Then, my funds on the account were fast increasing. Perhaps, that lucky streak inspired my self-confidence. However, without experience and sufficient knowledge, I didn’t enjoy gains for long. Only having tried all the ways of training, I can state that I have learnt to trade.

Let’s see the advantages and drawback of such ways of training as a course with a broker, the one via Skype as well as self-study. It is necessary to learn about pros and cons of free and paid training.

Training course with broker

It should be noted, that in a trading course with broker, teachers and students may aim at opposite things. It can be in case, when the broker is a dealing center, similar to a sweepstake Beginners go on for short-term trading courses to become a trader and learn how to make profits from financial markets. Some organizers may have a different aim for such training courses:

1. To train the beginners in such a way, that they will lose their deposit and return to the stock market;

2. To excite the beginners with large stock market profits on the examples of the greatest world stock traders;

3. Persuade the beginners, that the account should be opened only with that company. It is another matter, if a broker engages an analyst or an experienced trader to conduct webinars. That way the broker attracts new clients, and the professional trader becomes popular. If brokers work honestly, there is no reason for them to wait until the trader loses his/her deposit. The real broker earns only his commission fees.

Distance learning to trade

Skype is used for this purpose, and specialists train people. Usually, those study all the nuances of market trading remotely, who can’t attend classes personally. Distance Forex training becomes more and more popular every day. However, it’s not guaranteed, that you’ll find a good mentor via Skype. There are many false tutors on the Internet, which haven’t succeeded in trading, but have done that in teaching. A bad trader is unlikely to be a good teacher.

Training “Heart-To-Heart”

You can find your mentor not only via Skype or on the courses. A coach can live in the same city. It is important, that teacher should suit personally you.

I know a successful trader who devoted me a great deal of time for free. He liked talking about trading nuances. Once I asked a question, “Why are you teaching me the fundamentals for free?”. He answered immediately, “I like to repeat conventional wisdom, not to make silly mistakes myself”. Of course, not everybody can find such a trainer, but it is worth trying. As a rule, when training “heart to heart” it is not about the indicators and oscillators, it is about the psychology of trading.

My mentor always asked me about my trading success. Surprisingly, I hardly ever followed my teacher’s advice and did what I wanted. When analyzing the trading mistakes, my mentor liked to ask, “You’ve lost your funds. If you had followed my advice, whether you would have lost or gained?”. I had to admit, that I would have made profits from the stock market instead of losing my money, if had listened to my tutor. The reason for many of my fails was in my curiosity and self-confidence.

Studying through teaching

It is quite an unusual way to study, but it exists. Of course, it is impossible to teach without knowing anything yourself. Some traders couldn’t succeed in trading until they found their students. Only having explained how to behave in the market a hundred of times, they began to follow their own recommendations.

Training with social trading

Traders should always have access to their funds and not invest them to managers’ accounts. Social trading was developed in LiteForex company. The idea is the same with PAMM funds, but the trades are automatically copied to the client’s account from the chosen trader’s account. Quality monitoring gives all the necessary information for the selection of a professional trader’s account to copy trades. Investors have access to their own accounts: their money and trades. Other traders’ trades are copied to these accounts. You can change the trading methodology if you want to. You can directly connect the trader in your cabinet, ask your questions, learn everything about the strategies further plans.

Learning to trade on a demo-account

Learning to trade with a demo-account. Almost everybody starts trading with a demo-account. There are many traders, who don’t want to read anything or take lessons from professionals. They just trade on a training account with virtual money and study so. Can one learn to trade in such a way? Perhaps, it is possible. But it is better to start reading books or taking lessons from professionals. Trading is not a game, it is a certain way of behavior, a set of nonstandard reactions, which can be developed over time.

Self-education

This way of training is rather popular and can be as efficient as full-time education or that via Skype. Some companies develop training videos, which explain in an accessible form about financial markets, as well as the rules of trading. I watched some of the videos myself, but not all of them suited me methodologically.

Book writers are hard to be accused of being shill. Jack Schwager is quite good. He wrote several books about stock trading: “Market Wizards”, “The New Market Wizards”, “Getting Started in Technical Analysis” and so on. The book by Edwin Lefevre, «Reminiscences of a Stock Operator», became a real bestseller, but its practical usefulness is not so great. Peter Lynch wrote rather a good manual, “Beating the Street”, which became popular. Read lots of books on trading. You never know, which one will change your life and trading views.

What should you beware of, when selecting a coach? Of a teacher, who turns out to be a charlatan. It’s no big deal, if a teacher used to be successful and then went broke. It is far worse, if the coach never was a successful trader but succeeded in teaching.

You will succeed in trading only if you learn from a good instructor and read a lot of books. Is education worth spending money? It is. At least, it is necessary to buy books, which are quite expensive. If you find a good teacher, the studies are also worth paying for.

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