Tuesday, March 25, 2014

Should I Seek a Trading Coach?

I receive quite a few inquiries about the coaching of traders.  I enjoy working with traders and have been privileged to share many ups and downs with skilled market participants.  That being said, I'm not convinced that seeking a coach is the answer for many market-related woes.  Here are a few questions to ask yourself before considering engaging a coach:

1)  Do I need a coach or do I need a mentor?  A mentor is one who teaches markets and trading: who has experience in markets that you can learn from.  Many coaches are not active in markets and don't trade.  Many times struggling traders need role modeling and learning, not psychological assistance.  Problems in your trading are just as likely to cause emotional upset as the reverse. 

2)  Do I need a dedicated trading coach?  Many times, an experienced psychologist can address the psychological issues facing someone in a performance field.  If, for example, you find that stress is interfering with your decision making, a therapist experienced in techniques for dealing with performance anxiety can help you every bit as much as a trading coach.  This is especially the case when personal issues that affect your life outside of trading contribute to your trading challenges.

3)  Can I do it on my own?  There are quite a few good self-help resources available on the web and in book form.  I wrote my most recent trading book precisely to help traders coach themselves.  You may also find that networking with experienced traders can set you on the right path.  

Only after you've addressed those three issues should you take steps toward finding a coach.  In an upcoming post, I'll address what to look for if you do take those steps.

Further Reading:  Succeeding as Your Own Trading Coach

3 comments:

Doug A. G. said...

I guess it depends on how dedicated you are, I learned trading by myself without the aid of anyone and I can say I know how to trade. It's better to 'learned' it by yourself though you can asked about trading, but in the end, trading can be done by you alone, it cannot be done for you, trading is within you. The best thing is to collate great trading ideas from reliable sources, mold them into your own, and implement them the way you understand based from your own understanding how the market works for you. It takes time, but it can be done, and I did it, and I can prove it. But it took me around 7.5 years to learn how to make it, it took me this long because I want to find out by myself how trading is all about, in that way I can fully understand and be responsible to my trading. With perseverance, dedication, patience, commitment, and the willingness to seek and find the answer in making a good trade, nothing is impossible. Learn the process first and not looking for the outcome is the best way to get involved in the market - because the market is always there, once you 'learned' it, you're all set.

Trading is all about understanding how the market works, it's all about the whole market structure, it's about the market on-goings (around the globe), the current market environment (calendar events), about your trading tolerances, timeframe, the market product you are trading, finding the right/exact location to participate, the market price leveling (s/r, the pivots)/price reading, simple indicators you are going to implement (I used only simple indicators for I don't complicate my trading, 4 ema, 9 and 18 ma's), the patterns that are developing (the recognition), when all these things sync to my own understanding (I guess these are my edge), and also my emotional temperament, I can do my trading very well. But I also watch myself all the time (that's why we should learn/work more on our self, because of that 'invisible gorilla behind me/us, I/we need to watch him all the time). I think my recent humble post from my blog about my trading is an added info, link below.

http://observeandtrade.blogspot.com/2014/03/is-trading-easy.html

Michele said...

Can you do it on your own? Apparently yes. I did it. It took me just over five years to become profitable but I did it. I know, callers results not verified, but I've been running a daily blog for four years now and my results are public for all to see.

But I didn't really do it alone. I credit Trader Feed for helping me figure out how to be successful. Before that, I was bogged down in a sea of charts, indicators, and assorted technicals - and losing.

It wasn't until I began to understand the psychology of trading that I figured out first how not to lose money and then how to actually make money.

Curtis said...

"Many coaches are not active in markets and don't trade."

While I'm sure that such coaches may be able to help some traders, a coach who doesn't trade can't speak from authority. And a coach who hasn't produced 50%-200% returns can't speak from authority on how to generate those returns. Just as the trader who's generating 50% returns can't speak from authority on how to generate 2x returns.

I'd say most independent traders need to make at least approach 2x account returns for it to be worthwhile.

A trader with a 50k account producing 30% returns is earning 15k per a year of hard work. A 50k account is about 10x larger then most retailers. The same trader working in any other professional field for same time spent could make at least 40k and easily up to 60k with no risk.

A trader with a 25k account, 5x larger then average retailer, producing 50% returns is only making 12k per year or below minimum wage.

For trading to be a performance activity, then trading performance must be the best predictor of success. If say starting capital is a higher predictor of success then trading is primarily not a performance activity but a capital intensive activity.