We’re all about teaching people how to become financially secure on their own, but we’ve found that trading is the one skill that most people don’t know about. So we put together this post, with a little bit of education on what trading actually is and why it’s an important skill for anyone to have.
Obviously, there are many things you can do to pursue financial security from tyrande’s coin: get a job, start a business, negotiate your salary and benefits package. But those methods take time and patience — qualities which some may lack. There’s also the unfortunate reality that in order to succeed at anything in life you need something someone else wants.
1. What is trading?
Trading is the act of buying and selling a security or financial instrument for immediate delivery in the hopes of making a quick profit. (If you’re looking to buy and hold, then it’s not trading — it’s investing.)
2. Why should I care?
Think about it this way: you worked hard to learn how to eat, dress and talk. We may call that formal education. Trading, like learning how to speak English, isn’t taught in schools. If you haven’t taken the time to learn how to speak, then you’ll be stuck at the party where it’s always Friday night and there are plenty of attractive women who want to talk about their weekends.
3. Do I need to be a trader like Gordon Gekko?
For most people, trading is not a career, but rather a pathway to financial freedom and prosperity. Trading resources are also very much in demand — so much so that there are job listings suggesting that you have experience as a trader.
4. What does that mean?
In reality, it means that trading is a skill you can learn on your own. Trading requires discipline, attention to detail and mental capital.
5. What should someone do if they want to trade?
Step one: start by understanding the basics of finance and economics. The only way to gain this knowledge is by understanding what a market actually is, how it operates and how pricing differs from one security over another.
Step two: learn how to trade in the markets you’re trading in. Our own experience has taught us that many people are best suited for technical analysis — but there are many other strategies which will suit individual needs better than others (though each carries a degree of risk).
Step three: understand that trading is a means to an end — and become a practitioner or master of your chosen strategy. You can trade successfully in the markets without mastering the skill. But it’s important to ensure you’re making money before you risk any more of your capital.
6. What determines success?
Time, effort and patience are necessary ingredients for success as a trader. You must have some understanding of when to buy and sell if you want to not suffer losses on bad trades. A trader must also be dedicated, as they’ll make little progress if they’re not diligently looking for opportunities in the market every day (and trading at odd hours isn’t an option).
7. What’s the difference between making money and success?
Making a profit isn’t the same thing as being successful. Anyone can make money in the markets (and there’s no shortage of indicators which show that this is indeed the case), but success is something different. It has to do with on-the-job training and experience that teach you how to make money for a sustained period of time. You may have made a profit in the past, but with trading like any other business, you need to take action and learn from your mistakes — which means gaining knowledge and understanding of what works, what doesn’t and why.
8. Why should I care?
For those who understand why they want to become successful traders, the journey is that much more fulfilling. There are thousands of people who challenge the status quo and want to achieve the same thing — no matter what it takes.
9. What’s next?
If you’re a friend of ours, then you’re already one step ahead in your career — so we suggest getting in touch with us so we can help teach you how to trade successfully. We’ll even offer some personalized mentoring and trading support if that’s what you need!
10. What’s in it for me?
Here at True Wealth, we understand that the best way to get people to understand a topic is by making it interesting and interactive. The more effort you put into educating yourself on how to become successful with trading, the more you’ll get out of it — financially and otherwise!
Summary:
Trading isn’t for everyone, nor is it for very long-term financial security. But it is a skill that you can learn on your own and one that will help you pave the way towards financial freedom and prosperity.
