One thing from yesterday’s piece stuck with me, and I want to follow up on that irritant today. Here is the part of yesterday’s Q & A that is bugging me …
- However, the strategies I use are very effective and can make money more than 70% of the time.
- How can the strategies you use be effective at all, much less 70% of the time when you have not made money in three years? Did you buy an expensive, “sure-fire” system that “can’t miss?”
The question I posed is the part I want to follow up on today, as I suspect many traders fall victim to the snake-oil salespeople who promise you considerable success, or the folks who scare you into whatever it is they are selling. Here are three examples of these two marketing scams.
- Give Me Ten Minutes a Week and I’ll Hand You 50% Profits per Month Guaranteed
- Investors Who Fail to Understand That Gold Could Blast Past $2,000 an Ounce Will Lose Their Shirts
- We are headed for a terrible reckoning, my friend. We have spent like drunken sailors—$7.2 trillion in new debt—and received so little in return.
Folks, when I first started trading, I found these folks appealing. Why? Because I needed to know that I could make money at trading, and, by gosh, these folks were already doing what I wanted to do. Better yet, all I had to do to get to where I wanted to go is buy what they were selling. In some cases, I did. I either trial tested fancy sounding software, subscribed to a “sure-fire” profit newsletter, or paid for a service providing pre-analyzed, buy and sell signals. What I found is that, for the most part, the fancy software looked good but helped me little, newsletter A was newsletter B in a different format, and the service gave me buy and sell cues that, well, to put it politely, missed the mark widely. So, understand, it is perfectly normal when you start out to think those who claim long years of experience have finally figured it out.
As I found out, the trick is to not spend a lot of money “experimenting” with these folks. Sure, try out software, pay $20 to find out the newsletter guru knows no more than the CNBC analyst, or test drive the service that promises accurate buy and sell signals but does not deliver. Just don’t spend a lot of money doing this; spend a lot of time doing this because in this experimentation process is an opportunity, which is this …
You will find reputable quality newsletters that give sound advice and solid trade considerations. You might find a service that gives accurate buy and sell signals (I never did.) Most importantly, though, you will find quality software that works. It took me awhile, but I found my software after considerable time test driving. Keep in mind the software you find must fit your abilities, your trading style, and your budget. On this last point, one thing I found is that cheaper is not necessarily the best for one’s budget. In business (trading is business), it is true you have to spend money to make money, so when you are test driving software, make price the last thing you consider. Although more money does not guarantee quality, one thing is certain, cheap will not get you what you need. You need software that actually works.
My advice is that you avoid those who appeal to your sense of ease or your sense of fear (see above), seek out reputable products that have an independent track record, meaning they have been around for awhile, and other reputable folks in the trading world know the product and speak well of it.
Trade in the day; invest in your life …
