The other day, an ex-colleague asked me to point him to some trading books that would teach him to get rich.
I was cracking my head for some wisdom that could help him with in his journey as trader.
After a while, I told him: “Forget the book and the endless searching for the golden indicator or setup or Holy Grail. There are no shortcuts in trading. Instead, become self-educated by being a student of the market. Let the market become your schoolmaster and simply study each day’s trading action to find out which stocks moved and why.”
I believe the only traders who will survive in the market are the ones who invest wisely in their education. Many traders are simply penny wise and dollar foolish in this regard. They try to save money by not investing in education, gleaning hot tips from suspicious sources and throwing huge amounts of life-savings after penny-stocks, only to end up losing more than they would have ever spent on training.
You can either pay for education formally or you can study hard and let the market become your schoolmaster.
Just remember: You get what you pay for. All professionals in their field have had some degree of education to qualify them for their career. A trader should be no different. There are no shortcuts to learning; either resolve to study the market on your own or find some good education courses to help guide you.
For the first option, I do have a few book recommendations to start with.
Other options are:
1) Subscribe to Financial Magazines – Google terms you don’t understand or check them out at Investopedia – one year later you’ll be amazed at what you know.
2) Take a class – preferably in person (Big Fat Purse do offer excellent low cost courses), but online is ok too
3) Browse thoroughly through About.com’s Investing For Beginners site
4) Once you know the basics check out why I believe that ETFs are the best and safest way to built up your nest egg without spending too much of your precious time on investing