Take Lessons in Trading to Learn How to Play the Market

Choose the Right Curriculum to Learn Trading

a day in the life of a day trader
••• Jamie Grill, Getty Images

There are different ways to learn about trading, and each way determines the approach you can take to reaping a profit from the market. The costs and methodology behind these educational resources can vary drastically, so it is essential for new traders to carefully consider which plans suit their needs and goals. For example, a day trader who has a packed schedule and wants to act fast may feel they cannot afford to spend time studying books. However, a trader who intends to develop an intricate long-term strategy may find that brief classes and one-time seminars lack depth.

Another factor that can come into play is the cost of education. Free curriculum might serve as an introduction to trading but there are also resources that require payments to gain access to the most detailed information.

Ways to Learn About Trading

People who want information about trading tend to seek out books, seminars, online courses, and mentors, where available. What these resources offer in terms of content can matter as much to the new trader as to how it is delivered. People who are constantly on the go may find that an online course they can complete through their smartphone is ideal rather than attending a sit-down class.

Trading Books

Learning through trading books is a common method of instruction. A potential benefit of studying trading through books is that you can take your time understanding the approach and philosophy of the author. If a trading strategy is unclear, it is possible to refer back to the text as needed. One obvious drawback is that the book cannot answer follow-up questions the reader may have about the methodology. Furthermore, market conditions can change so dramatically that it is possible that some of the philosophies presented in the book may not always be valid.

Trading Seminars

Trading seminars can be an expensive way to learn about trading, depending on the entrance fee. However, attending an in-person session does offer the novice trader the chance to ask questions to clarify their understanding of the presented strategies. A live seminar can also offer ideas on trading that relate to the current market. It is an opportunity to collaborate with other new traders who are trying to determine the best approach to trading. Unless the seminar is recorded and made available after the session, the attendees will have a narrow window of time to absorb the lessons.

Online Courses

The convenience that an online curriculum offers make this a fast-growing way to learn about trading. Many investment and trading service providers include some basic trading information on their websites, while others go the extra step of supplying their customers with a curriculum that is available online. Those courses might be restricted to paying customers of the service. There are also outlets that provide trading curriculum for free or at varying prices. These courses might be self-guided, which means the student works independently.

This allows them to move at their own pace, but they might not be challenged to comprehend the strategies being taught before they use them.

Mentoring

Dedicated trading instruction and mentoring can be one of the more expensive ways to learn to trade. The lesson may be one-on-one or with a small group and personalized for the novice traders' needs. Choosing such a mentor can be as tricky as selecting a stock in which to invest. The potential mentor's track record and investment results are significant, but their ability to convey that strategy is equally important. If you are dealing with an individual mentor who operates alone, it is crucial to determine how their investment strategy fits with your intended approach.

Trading Without Training

There is another option to get into trading that does not require special instruction beyond the basic concepts. Analysis and trading services are designed to offer less experienced traders the benefit of recommendations from a professional trader. Such services can also include money management, where the customer allows their money to be traded on their behalf by a trained professional. This type of service may include a daily market analysis that is sent to the customer along with trading suggestions.

Customers might be able to place transactions they want through the trading service if there is a stock they believe will take off, for example, but they are largely relying on the expertise of others.

If you wish to become a trader, you will need to select the best learning method based on your goals. Some educational resources require time, money and commitment, while others allow you to work at your own speed independently. The type of educational resource you choose should fulfill your needs and also accommodate your lifestyle.