Last Updated on 11 September, 2023 by Samuelsson
Learning to trade, and particularly learning to trade by yourself can be a daunting task. You might feel lost and unsure of where to start. In this article, we will go into how you could learn to trade by yourself, and give you some valuable tips on what you need to be aware of. So can you learn to trade by yourself, without a course?
Yes, you can learn to trade by yourself, without a course, if you are patient and understand that it will take a lot of time! Trading is a competitive industry, and to succeed you will have to pave the path for your own success. Still, those who would like to fast track their success will find that investing in a good trading course will pay itself many times over!
How to Learn to Trade By Yourself
Learning to trade by yourself is hard, but not impossible. It requires patience, perseverance, and the willingness to learn by failing and starting over again. In fact, at the beginning of your trading career, you will probably do most things the wrong way. However, with the time you will learn from your mistakes and gradually gain more and more knowledge.
It is very important to understand that you will face huge challenges, of which many will feel insurmountable. You might even consider giving up since there never seems to be an end to your issues!
You can be sure that every self-taught successful trader has felt the same! Trading is VERY frustrating. The markets are merciless, and those who do not obey its rules, or try to impose their own views of how it should work, will not succeed.
If you were limited to only remembering one thing from reading this article, it should be to keep your mind open. As a beginner, most of the views you hold of the market are not true, and as such, following them blindly and trying to impose your views on the markets will never make you any money!
Tips for Learning to Trade by Yourself
So, let’s get to some valuable tips that we know will be helpful if you are striving to learn to trade by yourself!
Being humble is key to becoming a good trader. As we have touched on earlier, trying to impose your views on the market is NEVER going to work. In fact, this is one of the few certainties there are in trading. The market behaves as it does regardless of what you believe, and why you believe it.
Be sure to always validate your beliefs through backtesting or forward testing!
Do Not Follow the Crowd
The fact is that most traders are losing traders. As such, following the advice that a majority of traders follow, will not take you long. Most of the specific advice on how indicators should be used, or what chart patterns that work the best will be of no value to you, since it does not work!
It certainly is tempting to believe in the things that people say, especially when it is so much easier than coming up with ideas and concepts yourself. However, from testing most of the things that are out there on historical data, we are comfortable making the claim that most of the information is wrong, and does not work!
Being a successful trader means doing the things that most others do not. As such, you are making your way in uncharted territory, and are bound to make mistakes, some larger than others. In fact, making mistakes and acknowledging them is one more step in the right direction.
Do Not Use Real Money in the Beginning
The harsh truth is that everybody makes mistakes in the beginning as they learn to trade. It is not uncommon for new traders to trade for a long time before they manage to achieve consistent returns!
Do not trade with real money in the beginning. Instead, paper trade or open a simulated account until you feel like you are ready!
Do Not Underestimate the Psychological Pressure!
One of the main reasons why trading is so hard, is because it is so psychologically demanding. The loss aversion is deeply rooted within us, and becomes a hindrance to profitable trading, since you cannot make profits without losing now and then.
In fact, with some trading systems, often trend following ones, you could have a win percentage of as low as 25%, which is all compensated by the massive size difference between losing and winning trades!
Still, loss aversion is only one of the psychological challenges that you will face, so be sure to read more on this topic. Van Tharp is a good source if you want to learn more about trading psychology!
Related reading: Can You Learn Stock Trading in College?
Related reading: How Long Does It Take to Learn to Day Trade?
Find Good Information
Knowing what is good information when it comes to trading is not easy. The Internet is littered with fake trading vendors and “trading gurus” that promise to make you rich quickly.
If we were to recommend you one source that you could look into, that would be the “Better system trader podcast”. This is one of the few resources online that presents good and valuable trading information that really works!
By the way, if you would like some tips on other podcasts that might be of value to you, we recommend you to have a look at our article on the 20 best podcasts for traders and investors!
Make Risk Management Your First Priority
When it comes to risk management, there is a crucial difference in the approach of an experienced trader to that of a novice trader.
While the novice trader focuses on the returns he or she will get, the experienced trader is more concerned about risk. For sure, the experienced trader also wants to maximize his or her returns, but they have come to a very wise conclusion:
If you one day lose all your trading capital, it is over.
Securing your trading capital and making sure that you will be there the next year to profit in the markets is the one most important things you can do!
How Long Will it Take To Learn Trading?
Of course, it is impossible to tell how long it will take for one individual to learn to trade, since it depends on a variety of factors. However, what you can say, is that it probably is going to take somewhere between 1-5 year.
So, what can you do to really fast track your learning? Well, there is one thing that will save you a lot of time, and that is being unbiased!
As we have already covered earlier in this article, many aspiring traders come in with false beliefs and expectation. Those who succeed to remain unbiased while exploring trading will certainly learn much quicker, since they will be much more open to taking in reality as it is!
Still, there is one way to learn to trade even quicker!
Why A Trading Course Could Be a Good Idea
If you really want to fast-track your learning, there really is nothing better than taking a trading course! While learning at your own means constantly making mistakes and learning from them, a trading course saves you from making many of these mistakes.
In fact, getting to know a solid methodology that has proven itself for many people will save you more money in the long run than the trading course cost you initially! Therefore, you should not view the cost as an expense but rather an investment.
However, as with most things in trading, it is hard to know what is worth your time and what is not. Be careful when choosing a course, and look for proof of that the educator actually trades himself/herself. Never engage in a course that promises quick success with no or very little work. Such trading simply does not exist!
You indeed can learn to trade by yourself but it may take you many years of hard work, and even then success is not guaranteed!
However, by being perseverant and following the advice laid out in this article, you increase your chances of success. Still, nothing beats enrolling in a proper trading course!
Before beginning to trade, it is important to do your research. Traders should have a basic understanding of the different types of markets, how stocks, currencies, and other assets are priced, and how to interpret charts. It is also important to understand the different types of strategies and risk management techniques. Once you have done your research, you should develop a trading plan and strategies. This should include setting risk limits, identifying entry and exit points, and having a risk-reward ratio. Once your plan is in place, you can begin to practice trading with a demo account.
It is important to remember that trading is a long-term endeavor, and it takes time to develop the skills and knowledge to be successful. It is also important to have patience, as mistakes will be made. Learning from mistakes and trying different strategies is part of the process. Ultimately, having the right attitude and taking the time to research and practice are the keys to becoming a successful trader.