The FINANCIAL - Why Every Beginner Trader Should Use a Mentor

Why Every Beginner Trader Should Use a Mentor

Why Every Beginner Trader Should Use a Mentor

The act of trading stocks and shares is more accessible today than ever before, and everyone has to start somewhere. Even behemoths of the industry like Warren Buffett placed their very first trade in the distant past, well aware that they had a lot to learn. The concept of using your money to make money and putting it to work for you is an attractive one, but there are enormous complexities involved with doing so successfully.

Those just starting with trading have plenty of resources to investigate. There are thousands of books, articles, and videos discussing stocks, options, bonds, and all the other investment opportunities out there. However, when learning such a complex skill, nothing beats the personal touch of a mentor.

There’s a Lot to Learn

Most traders, when honest with themselves, will accept that there is always more to learn. Trading is not something where an individual can read a book or complete a course and know all about the market, even after many years of doing so. Even at the most simplistic level, new stocks reach the markets every day, and not all are equal when predicting their performance.

A mentor can become a beginner’s best friend because they have knowledge that can make trading far more comfortable. While a book will tell someone the best way to trade, at least in the author’s opinion, a mentor will analyze and interact. If a trade goes wrong, no book or video can investigate the specifics of how and why. A mentor can do precisely that, informing a new trader not only of how the trade failed but why.

The markets represent so much more than just stocks, and a mentor can be highly beneficial when exploring other options out there, thanks to context. It is possible to learn about ETFs from one individual and options trading. However, by learning from one person, a trader benefits from understanding these topics in the context of everything else their mentor does.

Experience Matters

The trading industry is not alone in being somewhere that individuals get better over time. Many people from all walks of life take pride in their mistakes. Some even consider their failures as the inspiration behind their successes. Absorbing written information is fantastic for a fundamental understanding of trading, but nothing beats doing it for real.

By taking on a mentor, a new trader can benefit from those mistakes without having to make them. They provide valuable insight into their thought process when approaching the market and usually have many years of success behind them, justifying those decisions.

Most Mentors Share Their Trades Regularly

When choosing a trader, it is often best to select someone that still trades actively. Some mentors are former traders or used to work on the markets. However, while it is always worth absorbing the theory and experience they can offer, there are few better ways to experience the markets than copying someone who knows what they are doing.

Some trading mentors, such as Mindful Trader, base much of their mentorship around the concept of alerts. Without having to approach them for advice actively, new investors can discover what they are doing at any given moment while also learning why. These alerts keep mentees in the loop on new and closed trades, market movements, and other pertinent information that a beginner may not even know to observe.

Support That Grows With the Trader

No new trader enters the markets intending to remain a beginner forever. A skilled mentor can ensure that as competence and confidence grow in their mentee, they can focus on more advanced topics. Meanwhile, they are always on hand to provide support and advice that makes sense at a trader’s current level.

The mentee’s knowledge of the market will grow with every trade, and that experience will enable them to think creatively. However, it is always worth having a mentor on hand to run these new ideas past. There are plenty of different techniques to approach the markets, but the vast majority have been tried before. What sounds like a fantastic idea on paper may have been tried and failed previously, and a mentor can make that clear to a trader without wasting time and risking capital.

It is essential to assess what a mentor can do for a budding trader before appointing them. It is always worth checking their trading history and the types of markets they work in at the most basic level. After all, nobody wants to learn from an unsuccessful trader, and there is little point in following a Forex trader if your interests lie in stocks and shares. However, with the proper guidance, a beginner can become an experienced trader in no time.



Author: The FINANCIAL