Because they believe they can figure it out for themselves. The stock market is not a do-it-yourself situation. Most of the critical training a trader needs is not on the internet, not on You Tube and not easily accessible unless you are a professional or are training with a professional which is rare.
Most of the so called “trader training” is just a retail trader who is unsuccessful trading stocks who decides to train other traders to make money. That is the crushing hard reality that most traders do not want to hear.
Many traders assume that if that use a certain strategy that they will be rich overnight. There is potential to make a good income from trading stocks but unless you approach it as a career rather than a hobby, the outcome is usually more losses than gains. There is the emotional factor which often ends up as a gambling mode mentality that if they just keep trying the same thing that once gave them a profit it will work at some point.
What they fail to realize is every loss is a big fist blow to their self confidence and self esteem since our society rates peoples’ worth on their income and not their qualities. It becomes a vicious cycle that requires a commitment from the trader and the mentor to work through. It is far easier to train a beginner who has no bad habits, not gut-wrenching losses that cause “scare money trading”, and no unrealistic expectations. However, even someone that has been trading and losing for years can learn what they need to know to change that situation and make it a positive outcome rather than a slow death of a trader syndrome as capital erodes to zero.
Beginner need to start their trading career by accepting that a few You Tube videos and some articles on a website are not enough. Most everyone wants their teenage child to attend college. Why? Because what they learned in grade school, junior high and high school is not enough to have the dream job they seek.
If your dream is to become trader who can make a living or extra monthly income from trading stocks, you need to:
- Learn technical analysis. It doesn’t come just from books, it also comes from learning in the live market atmosphere with a mentor who can show you the simple nuances that alter the outcome of a trade.
- Learn which indicators are right for YOU. There are 250 indicators that I personally have studied, research, tested as an example. I chose 5 that I find were the best of the best. They are not MACD, or Moving Averages. They are large lot versus small lot indicators and comparative indicators.
- Choose a trading style that is right for you, then build your own personal trading procedures and platform that works ideally for you. Everyone is uniquely different. There is no “one strategy works”. A strategy only works IF it is used with the proper trading style and parameters within a specific market condition. What I am saying is you will have 1 or 2 trading styles and many strategies.
- You need to know what charting software has what you need to trade with quick decisive, precision, and easy decision-making.
- You need to find a credentialed professional who is willing to take you on. Most of the training out there are amateur traders who failed at trading so they teach and none are SEC credentialed as only a professional or Accredited retail can achieve that status.
- Learn how to use just a few candle patterns. The candlestick books are loaded with reversal and continuation patterns but most are not worth the effort to learn. Choose 2–3 buy entry signals. That is all you need. Make or stock pick selection simple, easy, and not waste time.
- Accept that you do not need to trade every day. Choose when to trade and when not to trade. You will hear everywhere that you should “keep fully vested in the market at all times.” The financial services companies promote that myth because if you keep your money in their hands and never redeem or sell, well they can use your money to make money for their company. YES the can borrow your long term held stock and profit from that holding. Less is more when trading stocks. Believe me, most of the losses are due to retail traders trading too often, and choosing weaker stock picks instead of waiting.
- Be skeptical of social media, chatrooms, retail groups, etc. Most are not run by a professional so most of the information is a myth, inaccurate or down right manipulation to get you to buy something so someone else can profit. Learn to stand alone. Trading is not a group situation. All the best professionals trade alone and do not like being disturbed at all.
- Accept that you will never stop learning about the stock market. It is a continually evolving eco-system. Every morning I wake up and say to myself: “What new thing are you going to learn about the stock market today?” and I have been investing since the age of 12. The changing market is what keeps it fascinating and increases opportunities and the potential for new ways to profit from stock price movement.
- Trust your instincts. Traders do not trust themselves. They doubt too much and this just wreaks havoc on your trading.