The Best Single Word of Advice
First of all, I’m not a financial advisor, that is, I don’t give personalized advice. But I couldn’t think of a word that fit into the title better, than “Advice.”
And, second disclaimer, the title is just an artful tease. I don’t have any single word of advice that is magically powerful, or that will propel someone into new realms of profitability.
So, without further ado …
The one single bit of “advice,” for the general population of people considering trading for a living,
…. drum roll ….
That’s it, just don’t.
Just don’t. Because? Because, statistically speaking, the majority of people who attempt trading, will lose some money, become frustrated, and quit within a year or so.
It’s amazing how much you’ll see statistics about the wash-out rate, for new traders, quoted around Internet Land. And, honestly, in my opinion, it’s never talked about properly.
The vast majority of what you read is, really, advertising, or veiled self-promotion. I often see the statistics sensationalized, in such a way as to instill fear, then some pitch is made about some training you need, lest ya become part of the horde of newly penniless pitiful poor souls.
All is fair in love, war, and advertising, I guess.
But let’s think a while, about the population of people who try trading some time in their lives, particularly people trying for the first time. Let’s say, hypothetically, you’re reading this article right now. And let’s say, hypothetically, me Mr Author is trying his best to provide some helpful insights to you and all the others who are reading alongside you.
Let’s step back, and think of some parallel situations, with similar “populations” of people, who are trying something new. Have you ever gone to the first meeting of a Weight Loss group? The first meeting of a night class to learn a second language? A meeting of folks, considering buying into some particular franchise? What was it like, when you looked around you, at one of these sorts of meetings? I’ll wager that you sort of sized everyone up, and made some general assessment. For example, with a Weight Loss Group – the assessment might be “wow, I can see at least half these people aren’t going to stick with it & probably won’t even make it to 3 meetings.” And, of course, it came true.
Personally, I think trading is harder than losing weight.
Let’s say, half-ish of the folks who start with a Weight Loss Group never “show up” to the third meeting. I think the parallel, in trading, is “showing up” for the third month of trading. I’d guess two-thirds of folks just simply “don’t show up” to their third month of trading.
This might sound callous, but, in trading as in life, I think a lot of people just sort of lose interest and motivation in their pursuits, and “drop out” of their endeavors. I don’t view this as a negative reflection on them. And I don’t want to write anything here that smacks of the fear-mongering that I see in various online adverts for training – that is, I don’t want to paint those folks as victims, or worse yet, “losers” in the game of trading.
So, let’s say, to keep it simple, 65% of new traders will “drop out,” and 35% will continue. And if you were challenged to utter one single word of advice to the combined 65% and 35% of folks, what would that word be?
It’d be “Don’t.” Just don’t do it. Don’t waste a few months of your life, and probably some capital, if you think you’ll lose interest.
Me, personally, I differ in my feelings about the remaining 35% of folks who continue after the first few months, than most bloggers. I personally believe the vast majority of the remaining 35% have the capability to trade successfully. For the sake of this discussion, let’s say another 5% of folks actually give it an honest try, and fail for some miscellaneous reason.
So we’re left with 30%.
Are those good odds?
Are you part of the 30%?
I guess my best suggestion would be to remember a time when you were in a room of one or another sort of “newbies,” and you were doing a self assessment of yourself against the others. So, now, virtually, imagine yourself looking around a room of potential traders, and ask yourself, “Am I going to stick with this?”
I hope this helps.
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