The False Promise Of Forex Education Courses
As somehow who actively encourages forex speculation and experimentation (in all it’s forms) it pains me to criticise certain elements that have grown unchecked within our industry. For example I’m deeply suspicious of the benefits of trading rooms, we’ve discussed the issues of lag before; the time taken for the trading room operator to take the trade to the time you take the trade could be enough of a lag to render the service redundant. If the trader is employing an intraday strategy, trading off low time frames such as 3-10 minutes, the entry opportunity could be gone before the trading room operator communicates ” buy” or “sell”.
The plethora of black box ‘out of the box’ solutions advertised across the web are equally redundant, as previously mentioned the proprietary techniques claimed by the creator are generally nothing of the sort. The author will have taken perhaps four indicators and morphed them into one solid line and given it a funky name, “the turbo fx generator” or some such brand. However, none will excel in both trending and ranging markets and as a consequence all have an incredibly short shelf life.
Despite my concerns and doubts both trading rooms and box systems are relatively harmless, the cost of a trading room membership for a month can be as low as €100 per month, similarly the black box systems can be as little as €100 as a one off fee. In short you get what you pay for and it hardly breaks the bank. You can try the trading room for a month or two and it won’t dent your trading balance too much. The black box system is a waste, but again it’s a one off cost that you can put down to experience and many amongst us know the experience of buying a download or disc and expecting it to immediately work, to hoover up pips effortlessly from day one. We then quickly realise that there’s no short cuts in this industry, you have to put in the hours in order it to get out the pips. But by far the most ‘dangerous’ of all the ‘sales pitches to riches’ made in our industry are made by the vendors marketing trading education courses…
Courses with names such as “university” or “academy” proliferate on the web and in choosing their brand names these vendors are being very clever. Many of us are conditioned into believing we have to pay for extra curricular courses and education and the vendors pray on that core belief. Their packages comprise university style seminars and coursework as an approach. Many courses are residential and highlight the length of time required to reach the grade in order to justify the cost. There’ll be many milestones along the path of learning proposed by the course provider and you’ll be given shiny brochures and branded files in which to keep your copious and dubious notes. The overall feel is that the course will have been worth the money, after all if you’re entering into a new career, considering investing maybe in the region of €100,000 in a market and new venture, wouldn’t it be wise to spend perhaps 10% of that commitment on a course equipping you for the trials of trading?
Trading courses vary in price, however, there’s one overall consistency when you review what’s on offer, none of them are in the ‘throw-away’ territory were discs and trading room (month on month) membership is concerned. Looking around the market the prices appear to range from circa €5,000 to upwards of €20,000. Having had inside knowledge of one of the most revered and ‘respected’ trading ‘universities’ I can categorically state any money spent, whilst it may give short term comfort that the trader is on the first rung of the ladder, is money wasted. What’s provided can be obtained on the web free of charge through simple Google searches which would then take no longer than a day to absorb and put into practice.
It might surprise readers to learn that one file folder I’ve been in receipt of, that constituted the core of the trading course and education on offer, only amounted to two or three trading strategies with the recommendation that the trader risk 5% per trade on an account balance as low as €10,000..that was it. And one of the strategies, recommended for trading forex, was a simple moving average crossover. The 8 EMA crossing the 21 MA off a one hour chart is their “Holy Grail” and forms the main constituent of the FX element of the course. For that comprehensive education the price is circa €8,000, but you can bargain them down. That’s €8,000 for a trading method that’s taken seconds to describe and could be found with a simple Google search.
There is no university style course for FX retail traders that will adequately train the trader for the trials of life they’ll encounter, the experiences are so unique no shared experience can help. It’s important that any traders contemplating a spend on a course keep their hands in their pockets and spend only a small proportion of their funds on gaining education. And that education is best provided by market participation. Instead of committing circa €8,000 on a course why not spend €3000 by funding a mini or micro account? You’ll get a lot more value than a trading academy/university course and if you need a badge of honour for self validation then buy yourself a trophy and put it in your cabinet, you could call it the, “I’m nobody’s sucker award.”
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