In trading, as in all other fields, when a person succeeds, we want to know what his training background is. Most people who join DTTW are people who never took a course in finance but are very interested in trading.
And here is immediately one of the most frequently asked questions: Is economic background so important? Truth is, you don’t need to have a background in Finance, business, or economics to succeed as a trader.
In fact, some of the biggest investors today took non-business-related courses. For example, David Rubenstein, the founder of The Carlyle Group took a course in arts. The same is true with people like Bill Gross, Lloyd Blankfein, and David Einhorn among others.
These people are some of the biggest business and investing leaders today. Let us explain why.
» Related: The Case for Starting a Profitable Trading Office
#1. Teach Yourself How to Trade
The first reason is that you can teach yourself how to trade and invest. The concept of trading and investing is simple: find an asset that you believe is undervalued and then buy it. Alternatively, you can find an asset that you believe is overvalued and short it.
To identify whether an asset is undervalued or overvalued, all you need to do is to perform an analysis about the current price. For example, you can apply the concept of technical analysis. While these concepts might seem difficult on paper, applying them in the real world is not difficult.
Methods of analysis
Some of the things you need to know are the methods of analysis. For example, you can teach you how to use fundamental analysis in the market. This is where you use the news and economic data to predict the future direction of an asset.
You can also teach yourself the concept of technical analysis, where you will apply concepts like moving averages and the relative strength index to analyze the market.
Also, you can learn about price action. Fortunately, there are so many free resources that you can use. You can use YouTube to find good tutorials (TraderTv.Live over all). You can also enroll in a course using platforms like Coursera to learn about trading.
#2. Modern Technologies
The second reason is that the concepts taught in school have been made easier using technology. We believe that the modern form of education is broken. This is because students are taught the same concepts that older generations used to be taught.
For example, universities spend time teaching students about technical indicators and the calculations behind them. In the real world however, no one needs to understand how the relative strength index is calculated.
This is simply because the indicator has already been developed and all you need to do is to apply it in a chart.
You can also learn and experiment using demo accounts using some of the top free trading software. At DTTW, we offer the TMS™, which is an easy-to-use and feature loaded software used by thousands of traders every day.
Other software you can learn for free using a demo account are NinjaTrader and MT4. With these apps, you can create a system and then backtest it.
#3. A New Way of Thinking
Third, you can be a better trader if you teach yourself than when you go through the formal education. While education is important, We believe that you become better when you try and teach yourself new skills.
This is because formal education gives you a certain way of thinking. For example, it tells you that when a company has a Price-to-earnings ratio of above 40 is expensive and so, you should avoid it.
In real world, you will meet companies that have a high PE ratio and doing well. In fact, this is the reason why many young traders are beating Wall Street veterans today. This is because they are investing in new and fresh companies like NVIDIA and Google while ignoring the old industries like crude oil.
The demo mode will help you in all this. Besides, a demo is just similar to a real account with only that it does not accept real funds. Some of the things you will find in a demo mode are all charting tools like technical indicators and tools like the Fibonacci retracement and Andrews pitchfork.
Also, in the demo mode, you will have a platform where you will find all news sources and even chat rooms where you can interact with other traders.
4. Discover your niche
Another reason why you don’t need any academic qualification as a trader is that you can always discover your own niche.
This means that you don’t need to know everything about the market. You can focus only on a narrow asset like a few currency pairs and be good at them. You will then expand your horizon on other assets as you grow.
Tip - Create a smart team
When hiring traders don't give too much weight at their financial background. Sure, You want people who have a college degree, but you don’t always hire them. It is good for the whole team to have members with different background.
You have to train all your traders from scratch and show them how to identify trading opportunities. We believe this is part of the reason why these traders succeed even when they open their own floors.
› Related: Tips To Succeed in Day Trading
External useful Resources
- 10 Keys To Becoming A Successful Trader - TimothySykes