Learn or you will stop trading
Many beginners feel that they can just jump in and start making money. Some think they can learn trading in 2–3 months. Can you imagine any serious profession that could be learned in such amount of time? Trading is certainly not the easiest of professions.
Quite a few traders have never even tried to learn. They thought they could use stock-picking services or newsletters, and trade their picks without deep understanding. I don’t know any of them who could make money consistently.
When new traders come to the marketplace, ready to trade stocks, they buy here and sell there based on opinions or systems they don’t really understand. It is easy to make profits in trading without any effort. You just have to get lucky. Then comes either the big loss or a string of losses.
Conclusion: Traders must go through a process of learning before they can start making money consistently.
How do you Learn?
The basic requirements are the same as for every learning system - Books, web resources, technical analysis software, seminars, courses, certification. There is one additional requiement: Practice. While practice makes perfect in every profession, in trading it is an essential requirement.
Can retail traders be successful in Trading?
Yes, of course. Most successful traders are retail traders. When you go through the learning and practice process, you get transformed from an amateur to a professional.That's when you reach success.
When I write about retail traders or amateurs, I am referring to people who enter the trading world without adequate preparation. Often, I have mentioned that beginners should not rely on trading for a living. This is the reason. When you are learning, you do not expect education to actually provide you with an income stream. That comes after your learning s over. Moreover, thanks to futures & options it is possible for beginners to overtrade using the leverage provided by derivatives. That becomes a deadly combination - beginner + leverage.
I receive calls from novices (like Housewives or retired people) who have taken on large futures positions. (They call me when mark to market losses start). Should they be dabbling in derivatives? Answer is - NO.
Trading is a joy. Like all professions, you have to give your dues to trading (time spent in learning and practice), then you get the rewards.