Learning from Experienced Traders

Trading education is a multistage process that requires immersion in information and a lot of reading. But that doesn’t mean that it has to be boring. In our article on trader success stories, we’ve already shared some inspiring personal cases of experienced traders and discussed their character and behavioural traits. This FXOpen article covers several techniques used by successful traders that you may have never heard of.

Why Is Trading Education Important?

According to research conducted by SMB Capital, many traders fail due to cognitive biases and a lack of developmental focus. They found that there are only a few platforms for people seeking to improve their knowledge and skills in financial markets.

However, successful trading can be nurtured through structured development programmes such as mentoring and internal universities, as well as internship and training schemes. Leading financial organisations like Tiger Cub and Goldman Sachs cultivate talent and provide opportunities for traders to learn, train, and improve their skills.

One of the most important conclusions made by researchers is that it’s best for an aspiring trader not to try to do this alone. Traders should try looking for training in organisations that actively promote talent development. Additionally, learning from traders who have been working in this field for longer is significantly accelerated by mentoring, coaching, and teamwork.

Self-Education Techniques

If you want to start learning from successful traders, you can apply these three methods to build knowledge and improve trading skills.

Using a Structured Curriculum

Here’s an analogy. Programmes offered by leading medical schools are very clear and aim at maximising talent development. Doctors first undergo undergraduate studies, where they learn the basics, followed by supervision and practice under the guidance of experienced medical specialists. Traders can also go through similar stages, starting with a foundation of knowledge, then market observation and trading in a demo account, and then real trading.

Learning Through Observation and Recording

Here’s another analogy. Consider a basketball team. Reviewing game tapes that teams play to prepare for upcoming matches facilitates skill mastering. Traders can do the same thing while watching asset performance in financial markets. Such observations can also be recorded and shared with others for feedback. Such an exercise can serve as a professional and personal learning experience.

Additionally, research shows that unique cognitive and personality traits distinguish traders with different strategies: day traders, swing traders, long-term traders, etc. Therefore, it’s important to try different areas and determine what interests you. You could open an FXOpen account and go through the available instruments and markets. Consider trying your strategies using a demo account with no risk.

Organising Training Within Teams

Traders who are taught the basics and then learn on their own have been found to be less successful than those who trade with mentors and peers. When the student is also the instructor, the learning opportunities are multiplied. Particular success is seen when junior traders create technology for senior traders that enhances trading opportunities, and the senior traders share with the junior traders their experiences with these opportunities.

No Gambling Mentality

Some would say that many broker clients belong in a casino, not in the financial markets. They gamble excessively and do not want to seriously educate themselves or reduce risks. They want to bet on ups and downs and see what happens. Poor investment habits lead people to treat financial markets like casinos.

So, the thing that separates successful traders from those who lose money is that they trade according to a plan and manage their risks. Trading education works because sticking to strategies and plans is better than mindless gambling.

Discipline Matters

If you’re a trader, it’s your job to be disciplined in your decisions. This needs to apply every day, and if you are not disciplined 100% of the time, then you are not disciplined at all. The time for extremes, excitement, and other emotions should be found outside of trading hours.

If you lack the discipline to exit a trade on your own, you should automate the process by setting a stop loss. This is necessary to get out of a losing trade before it causes too much damage. Successful traders look into the future and look after their capital first and foremost.

There’s also no time for hoping and praying. If you do, chances are you have already lost. As a rule, hope replaces the understanding that the trade is unprofitable.

Unfortunately, traders get too emotionally invested in their trades. It’s better to avoid this. The best traders are the ones who don’t get too emotionally involved and treat it like a business.

Final Thoughts

Performance success starts with talent and continues with skill development through focused practice. This way, for example, organisations recruit talent to ensure their businesses are built on strong foundations. And you, as a trader, can do the same. If you put education first and think about your emotions and behaviour, trading will become easier and clearer.

FXOpen is dedicated to supporting the development of our clients, so we will be happy if you find our blog, news reviews, and tools on the TickTrader platform useful. FXOpen offers CFDs on a wide range of currency pairs, indices, commodities, and stocks. You can choose what you like and start trading on our platform today.