› Hard in training easy in battle.

Hard in training easy in battle.

19.10.2018, 10:33

The training duration and complexity depends on which job do you pretend for. If your dream is to become a janitor, then one hour of instruction would be enough. All you will need is just to hold the broom in a right way and know how to open garbage can covers. If on the other side, you want to be a pilot or a surgeon, then you need to have much more knowledge and skills. Stock exchange trading is much closer to the aviation rather than to yards sweeping. You will need to dedicate a lot of your time and efforts if you want to grasp it.

The society requires a durable and serious teaching of future pilots and surgeons just because their mistakes can be fatal. A trader is free to commit a financial suicide, and the society does not care about that because your loss is someone’s profit. Aviation and medicine have own standards and references, and also there are special supervisors which control the compliance. You will need to set your own rules in currency trading and control yourself on your own.

Pilots and doctors learn the profession under the guidance of instructors who bring them discipline using tests and assessments. Private traders do not have such an external training system, nobody tests them and puts them in disciplinary limits. Our job is tough because most of us have to learn by ourselves, we need to work on our own discipline and to rate ourselves in the real market conditions.

If you would look at pilots’ and doctors’ learning process, three eye-catching moments appear gradual responsibility boost, continuous rate of achievements and automatic skills practising. Let’s have a look, how can we use these principles for a trader’s training.

Learning stages
Source: Master Futures


1. Gradual responsibility boost. Newbies do not get behind the control panel in the aeroplane initially when they have just got into the pilots' school. A medical institute student can consider himself lucky if he would get a chance to put a thermometer to a patient in his first day of hospital practice. Instructors check every single step of the student before allowing him to get onto the next stage where the responsibility level is much higher.

How can we compare that to a trader’s training?

A gradual entry into the profession does not exist here. The vast majority of people come to the exchange at random after a rumour will reach them that someone made good money by trading. A newbie has money which burns a hole in his pocket. He finds a brokerage company by a newspaper, transfers the funds there and opens his first deal. And just then he starts learning! What about the close time of that market? What is the “opening gap”? Why the market rises while my share falls?

A deep-dive method for training is not suitable for such complicated types of activity like flying a plane or trading on the stock exchange. It is excitingly interesting to jump into a river from a cliff but a serious trader is not seeking adventures. If you did not have an exact trading plan, you would better take that money to the casino. The result will be the same but at least you will get a free drink there.

If you have seriously decided to learn the exchange trading, you would better open a small trading account and put a target in front of you to learn how to win as the main goal. Keep a trading diary and get yourself a rate for every single deal.

2. Continuous rate of achievements. Academic performance of a pilot school student or a medical student is measured by a hundred tests. Teachers rate their students regularly for knowledge, work skills and ability to make decisions.

What about traders in this field?

You can trade offhand until you have money on your trading account, trying to get out of the hole that you dug for yourself. You can through brokerage bills to a locker or give them to your accountant once a year. Nobody will force you to look in your tests results if you will not want to look there on your own.

The market examines you all the time but nobody pays attention to that. The market rates every single exchange deal and posts these rates but almost no one knows where to find them. Another objective test is your capital curve. If you trade on several markets at the same time, you can apply this test to every single one of them or you can apply it to your general trading account. Do we look at these rates? No. Pilots and doctors are accountable to supervisors that provide licences while most of the traders just run away from lessons. Nobody looks for attendance and they do not have an internal discipline. Meantime, tests are the key factors to success. If you keep and regularly review your trading activity records (we will talk about them in details later), then you will leave your competitors far behind.

3. Automatic skills practising. I’ve been sent for a survey of a patient in a half-empty hospital room during one of the state exams in the medical faculty. I heard a strange noise, I looked behind a folding screen and I saw another patient there - he was dying. “There is no pulse”, - I screamed to my classmate. We both put that man on the floor, and I started the heart massage while my mate was making artificial respiration, one forced breath with four presses. We could not get up and call somebody for help but suddenly someone opened the door and saw us. Reanimation team with defibrillator rushed and the patient was saved.

I did not make any reanimation processes before that case but it worked from the first time because I was learning that for five years. I did not need to think when the action time came. The main sense for the professional training is that actions have to be automatic and we could focus on strategy.

What would you do if a share price will jump for five points in your favour? What about five points against your position? What if your futures contract price will limit the upside action limit? A downside limit? If you need to stop and think after you have opened a position, then you are doomed. You need to make the trading plan in advance and decide what are you going to do in this or that situation. Play out a couple of options in your head, work them out on a computer, just not to think what should you do in the trading process.

An experienced trader reaches a level when most of his actions become completely automatic. That allows him to think about the strategy, not tactics, focus on targets but not on the ways of reaching them. It is possible to develop that ability only by gathering a long-term experience of trading. The more you trade and the more deals you make, the more deep knowledge and skills you have. It is better to learn many deals with small volume. Remember that the first and the main goal for every beginner in trading is not related to making as much money as possible, but to learn how to trade. The money will come once you will learn.


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