Day Trading Schools – 11 Things to Consider
Let me first start off by saying that if you have landed on this article you have realized that the search results for day trading schools are slim. While there are quite a bit of results from Google; however, there aren’t many of what I would call “traditional” schools in the search results.
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You are going to quickly realize that there are no real schools for trading. There are a number of programs and courses that will help you build foundational skills, but no 2-year or 4-year degree programs. So, where does that leave you in your hunt for schools? Just keep reading, I plan on giving you an ear full.
Feel free to click through to these sites after you finish reading this article. I think hearing what I have to say, whether you decide to move forward with these folks or not will at least give you a different perspective before spending any of your hard earned money.
Trading is one of the last professions that does not require formalized education
Trading is one of the last frontiers in our modern capitalistic society, where you can literally go from rags to riches without any formal education or training. You could be the successful surgeon or 3rd grade English teacher; your odds of success are exactly the same. Your potential for success is not tied to your ethnicity, education or gender like many other industries.
As I’m thinking through all of this, this level of playing field in trading, which is based purely on merit is one of the main things that attracted me to trading. I love the fact that you are not limited by where you went to school or whether you look like the senior leadership team. It truly comes down to whether you can make money or not.
So, you have to ask yourself, how will formalized training help you?
I think it may give you a sense of confidence because you have completed some sort of curriculum. Trading is a very isolating industry and outside of the meet-ups and trading expos, you will likely find yourself alone at your computer with your charts. This level of isolation at times may cause you to pause and think about whether your definition of the market is really applicable and is it something that can really make money.
A certificate from a trading school can provide just that, validation to you and others that you have passed someone’s idea of what it means to be a qualified professional in the trading industry.
At the end of the day, the education will not make you a success. Traders cannot be taught how to make money no more than a professional athlete showing you exactly how to throw a fastball. They can walk you through all of the mechanics and nuances of how to throw a baseball, but at the end of the day, you have to have something in you that will make you a success. For some it will be hard work, others natural God giving ability, but the law of averages will remain the same. Only 10% of traders will make it, and only 1% will make a killing.
So let me ask you, what do you hope to get out of a day trading school?
Becoming a top trader is about you not attending school
Developing into a top trader is all about you and little to do with what school you attend. Before this article turns into an all-out bash on day trading schools, let me first say that trading schools are great for giving you the fundamentals of trading and learning about how the market works. The schools will help a new trader grasp such theories as buy low/sell high and the trend is your friend. However, I do feel that the schools are doing people a disservice by giving the impression that after completing the coursework you will somehow become a master trader with money raining from the heavens.
Becoming a top trader is about learning what makes you tick. There is no cookie cutter way to trading. For those people that have obtained success from following other people’s systems, it is merely a coincidence that the trading strategy of the school is a match for the trading personality and style of the student.
For example, if you are a trader who is destined to trade volatile stocks because you are 100% okay with high volatility. How well do you think you would do if your school was trying to teach you a low volatility trading system? This is where trading schools can only take you so far and you have to do the hard work to take your trading to the next level, by making the system fit your trading personality.
Trading Schools are too expensive
Again, we are going to loosely call them schools, but at the end of the day trading schools are way too expensive. Courses can run anywhere from a few thousand up to $25,000 or more for personalized one-on-one training.
Did you know that the majority of what these schools teach you is readily available on the internet and books? If you take a look at some of the best trading books, such as ‘Technical Analysis A-Z’, ‘Trading in the Zone’ and ‘Reminiscences of a Stock Operator’, you will find pretty much all you need.
The real trading education comes by actually placing your money on the line and seeing how you respond to the market. This is where your “trading tuition” is paid; not to a brick and mortar school.
What is their curriculum?
What are you looking to learn? Saying you want to go to a day trading school is equivalent to saying you want to go to college. What do you want to specialize in? You could trade options, futures, forex, stocks, etc. You could focus solely on technical analysis, or you could use some fundamentals in your assessment as well.
Depending on your area of focus, you will need to validate the day trading school can meet those needs.
Who are these instructors?
On some of these sites, you will see a number of instructors with pretty impressive credentials. This would prove helpful if we were in a traditional corporate setting. But if I were you, I would want to see two or three things from my instructors:
- How much money have you made?
- What have been your annualized returns for the last 5 years?
- How long have you been trading for a living?
If you receive responses to any of the three questions above and they are not stellar, then you are not talking to a successful trader, but a person who has studied trading. If you are going to be the best, you need to learn from the best.
When does the schooling end?
For these day trading schools, when does the education end? For all colleges and universities, once you receive your diploma in hand, you are no longer required to take any further courses or complete any activities to retain your educational status. You have earned that right from all of your hard work in the classroom.
Now for the trading school, are they requiring you to take follow-on courses or requiring you to stay on a “high performer” retainer? While markets may change and we will go through cyclical bull and bear markets, your trading skills should make you profitable in any situation.
So, if the school is requesting that you continue to pay them after you have completed all of your required coursework, this should be a red flag.
How do you measure if the education worked or not?
You have completed all of your coursework, and have your freshly minted certificate sitting on your trading desk, now what? Let’s say you spent $5,000 dollars to attend the course, how do you measure if it was a success.
If you are completely new to trading and have not placed one trade in the market, you will literally never know if spending the money helped you or not as you have no previous trading record.
Now for my seasoned traders, you should see your equity curve improve. If you were making $200 dollars daily from your trading activities, you should see that number increase. That increase should be large enough that you can see a positive return on investment after attending the school.
How are schools evaluated?
I remember looking for colleges coming out of high school and you could find a number of publications which ranked the top schools in the US. These rankings were for specific fields and were based on the quality of the teachers, job placement rate and salary upon graduation to name a few.
Well, how do you apply this sort of logic to day trading schools? First, there is no unified way of evaluating the schools, like you have accreditations for universities.
It is really going to come down to your expected level of spend, what you know about the trainer or owner of the school and a bit of good luck.
Where are the successful students?
The one thing all schools have in common is they love to send you information about the graduates who have done well for themselves. I guess it’s the school's way of trying to attribute the graduate’s success to their time on campus.
Well, for these day trading schools, you should see similar popularity campaigns. The student’s photo and success story should be easy to find. There should be total transparency into the student’s success and a deep explanation of how the day trading school helped them achieve such heights in the trading field.
If you can’t find any students willing to stand up and raise their hands screaming that they have become a success from the time spent learning the school’s method of trading, then you have found another red flag.
Chartered market technician (CMT)
Becoming a chartered market technician is one of the few recognized certifications that I know of for the trading industry. You receive this certification from the Market Technicians Association which from reading their website has over 4,500 professionals in 85 countries.
You have to ask yourself is it worth it to complete the coursework for a random trading course, or would you rather receive a certification from an organization that is globally recognized in order to attract new business?
Think about how many project management professionals go after there PMP, I view the CMT as having the same benefit.
I believe that trading is a journey that one must walk alone; however, we all need a little help along the way and schools may be the right answer for some. For me, it was more about reading everything I could get my hands on and trading in the market.
Now whether it’s learning by exploration or learning from a school, whatever makes you money, go for it. The key thing to take away from reading this article is that becoming a successful trader is not about some singular event which takes you over the top. Trading is about dedicating yourself to your craft 100% and simply refusing to fail.
So, if you want to take some day trading course or attend a day trading school, go for it. Just be very cognizant to the fact you likely have a long, hard road ahead of you that doesn't stop because you circled the right letters during a multiple choice exam.
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College Graduation Photo by Bradly Dillsworth