Learning to trade: Do I really need a trading education?

February 7, 2020 (4y ago)

First, a note on transparency: as we at WirmachenTrader offer trading education ourselves, we are naturally a bit biased. However, we will try to examine and explain this question as objectively as possible in the following. For this purpose, examples from the normal professional world are used to create a certain comparability. In addition, we want to approach this question based on comparable facts.

Can trading be learned?

If the answer to this question were "no", trading education would not make sense per se. Trading is a skill that can be learned. Not least, I also devoted myself to a similar question in my master's thesis.

It was also clearly proven that trading is directly related to emotional intelligence. Therefore, it is so important that we really understand our emotions in trading. Why do we think something is "worth" something? Why are we angry when a trade doesn't work? Wrong expectations and wrong ways of thinking are the main cause in this context.

So if trading can actually be learned, we have to ask ourselves why so few succeed. Is it because most education is simply inadequate, or because it's just so difficult?

I would answer this with a mixture of both factors. If you analyze different training methods, you will quickly realize that often strategies are taught that work for the coach. But if you deal intensively with the subject, you will realize that trading has a lot to do with personality. It is always our money that we lose. Therefore, we must be 100% behind what we trade. So if we simply follow a coach's strategy because he is successful, this will not lead to success for ourselves. Because in life, you only really succeed at something (and this is not just about trading), if you really want it and give everything for it. It's the same in trading!

What a trading education should be like

Successful strategies are good as a template, if you can make them your own! This means that the actual education should include how to make the existing system your own. These systems are called adaptive systems. Otherwise, sooner or later, you will run into one of the following problems: the system suddenly stops working one day or your living conditions have changed, and you can no longer trade at the required times. These are just two of many problems that a fixed strategy brings with it. Therefore, you should always make sure to learn an adaptive system. This is a major quality feature of a good trading education.

Our approach is to show people how to develop their own strategies and systems.

"Give a man a fish, and you feed him for a day. Teach a man to fish and you feed him for a lifetime." - Confucius

In every education, you learn to be independent. Education takes time. It is so astonishing (and frightening) to see that many providers advertise with quick wealth and an easy solution. Probably because those are the phrases that everyone wants to hear. That they actually cannot be true should be clear to the majority (rational self). But inwardly, one still hopes that this time it is true and that it will work with wealth overnight (emotional self). As you can imagine here, these two selves play a significant psychological role in trading).

Why you should take a trading education

The internet is full of information, images, and videos on every topic imaginable. You have access to world knowledge in seconds at any time. There is millions of knowledge and information on trading on the internet. We have also been intensively maintaining our YouTube channel for several years now, where we regularly post videos on trading content. So, why should you pay money for a trading education when the knowledge is freely accessible on the internet? Then what is the added value of an education?

If you are a good learner, can optimally acquire, process, and structure knowledge yourself, you probably won't need education. Then the freely accessible knowledge on the internet would be enough for you. But this type of learner is the exception. There are also four other reasons that speak for trading education:

Time

I thought I didn't need education. Accepting help was not my strength back then. (The more I open up here, the bigger and faster the jumps come to my career.)

Time is money. The fact alone that our time is very valuable makes it make sense to get a certain boost and acquire knowledge faster. This is an ability that truly successful personalities understand. Courses, seminars, etc. are seen as a real investment in themselves for these personalities. Something that takes them one step closer to their goal. But we could also define time in another way.

Knowledge

You want to build a trading business as a trader. Achieve a lot independently. This is only possible if you understand what you are doing. Here, too, it makes sense to learn from people who have already achieved what your goal is. Ideally, you are accessing knowledge that others have built up over years in the shortest possible time! Through the coach's knowledge advantage, he will inform you, if necessary, about new changes in the respective niches. What if the increasing technological means change trading? Your coach will be prepared for the best case.

Motivation

Motivation plays a decisive meta-role in learning to trade. Every successful trader today was once at a point in his trading career where he/she wanted to give up. In my opinion, there is also no way to avoid this experience. It simply belongs there.

And because everyone will reach this point, it is all the more important to know what to do then. Simply put, it is: persevere. Of course, you can also go through this phase alone, but my experience shows that it is easier in a team. It's like in team sports. Even if you as a player of a team have a bad day, you still have teammates who can compensate for your bad phase and still win. Trading is a little different, but still similar. That's why it's important to have a space to be able to exchange ideas with other like-minded people and to have someone to ask when you have motivational gaps. That's why our community is an essential part of our education. That's where you share fears and questions and celebrate progress and success together. Everyone there is pursuing the same goal: more time for themselves, their family, and financial independence.

Costs

An education costs money. But how much does it cost if you trade alone, without a plan, structure, and basic knowledge, and lose most of your money after just a few weeks? In addition to the actual capital, we may also lose our mental capital. A look back at my first year of trading as a student provides a small comparison: I lost over 1,600 euros and a year's time. Instead, I could have invested the sum in education and earned my first profits at the end of the year. Of course, I would appreciate it if you could save this money. However, my experience and that of many other traders show that this money is necessary. It is best not to see it as lost money, but as an investment in yourself and your future. Because ultimately, that's precisely what it is!

Conclusion

Let's summarize: Trading can be learned. Trading education is not necessarily necessary, but with consideration of various aspects, it gives you a certain advantage that you should use. When choosing your education, make sure you learn the process and not chase after a simple solution that doesn't exist.

Trading education is like business consulting. Your business is your trading. So, you are advised on how to better utilize your processes, systems, and strengths. Trust between coach and student is another aspect that is essential in my view.

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