Monday, January 11, 2010

What Beginning Traders Should Look For in a Trading Career

In my post on pursuing trading for a living, several traders have responded that my point about the odds being stacked against success could be said of any field: the odds of getting rich are slim. That misses a crucial point, however: in many career fields, a competent practitioner can make a decent living: as a teacher, a store manager, a nurse, etc. In performance fields, such as acting, golf/tennis/basketball/track and field, and trading, competence does not guarantee an income. The percentage of people making a living from their performances is quite small; the same cannot be said of teachers or salespeople.

That is why going off to pursue trading is more like going to Hollywood to pursue acting and less like going to school to train for a healthcare career.

I am not suggesting that people *shouldn't* pursue trading careers. I am only recommending that those serious about trading:

1) First find out if they truly possess interest and aptitude by trying trading out in simulation/paper trading mode before committing time, capital, and effort;

2) Pursue quality training efforts that offer structured curricula and that teach skills that are relevant to one's own interests and talents;

3) Seriously consider affiliating with trading firms that offer sufficient capitalization (if not well-capitalized on your own) and discounted commissions/fees to keep overhead to a minimum;

4) Affiliate with traders (within a firm or online) that are experienced and that encourage mutual learning, mentorship, and support.

Your odds of sustaining a trading career are greatest if you can locate yourself within a learning, performance culture. That does not guarantee career success, but it maximizes the odds that you will be able to transform your interests and abilities into concrete trading skills.

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