The training steps needed to become a trading superstar
IN ANY popular Hollywood movie that aspires to true greatness, a montage scene, in which the hero learns the skills needed to succeed, is de rigueur. The pinnacle of this cinematographic method can be seen in the 1976 film Rocky. A movie about a retail trader earning a steady income from spread betting might not prove as exciting, but training before entering the battle of the markets is no less important.
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David Norman, who trades, trains traders and writes books on trading, says the technology that traders can now get in their homes is significantly better than it used to be. He explains that people now have instant access to the equivalent resources of institutional traders five years ago. In the same way that technology in cars has permeated down, so it is with computers and trading. As such, he says a standard home computer will have the system requirements on which to trade. However, Norman stresses that it is extremely important to have a good internet provider and be ready to call your provider to execute trades over the phone if it goes down.
FEAST ON FREE LUNCHES
Rocky Balboa financed his training to transform himself from a club fighter into a world heavyweight champion on a budget. He opted for the 72 steps of the Philadelphia Museum of Art rather than forking out for a step trainer. Norman recommends that those new to trading should “start from the attitude they should get as much for free as possible.” Most platforms offer free trading seminars and online resources. For example, FXCM, in conjunction with Morning Wire, are hosting a free forex trading seminar on 23 June: www.fxcm.co.uk/seminar.
DON’T RELY ON THE GRAPEVINE
Norman notes there is no shortage of services available for traders, which can be daunting for those just starting out. As such, he suggests looking through trading forums to see which services experienced traders praise. Norman recommends the portfolio facilities on Yahoo and Google, the calendar on forexfactory.com, the Bloomberg and Reuters news feeds and the free resources offered by providers. For tracking down the dates of company announcements, he suggests using dividend.com and earnings.com, as well as visiting the company websites. Ian O’Sullivan of Spread Co adds: “Twitter is a great source of immediate news these days.”
TRAIN TO WIN
In Matthew Syed’s recent book, Bounce: How Champions are Made, he argues that the commonly held assumption that natural talent is the crucial factor for success is erroneous. This lesson also forms the crux of the fictional southpaw boxer Rocky Balboa’s success and can be translated into all areas of people’s lives – including trading. Norman says people need a minimum of three to six months of preparation before trading proper. This should include research into interday and intraday movements, who and what moves markets and how to devise trading plans. However, David Jones of IG Index cautions against being “one of those people who thinks about it for years and never does it.” He suggests: “Start trading, but trade small, and realise it is a marathon not a sprint.” And for inspiration? Listen to Gonna Fly Now and run up your nearest set of stairs.