Selecting forex trading courses ………..The same mistakes repeated
One of the things about running these courses is that after a time there is a certain element of Deja vu about novices experiences before they arrived at my door.
It is apparent that most people appear to be making pretty well the same mistakes with regard to selecting trading courses to attend or products/systems to buy (and indeed in the methods that they choose to trade – but that must be left for another article).
So you tend to meet people who have tramped along the same old well worn path that leads them nowhere.
To be honest 90% of this industry feeds on that “innocence”. So on this page I thought that I would make you aware of the typical mistakes novices make when selecting forex trading courses.
I also identify an incredibly simple way of avoiding those mistakes which all but guarantees that you select a course or other trading product that will genuinely help you on your journey from novice to professional trader.
By necessity I have to keep these articles relatively short but if you would like me to expand on any of these points then please do not hesitate to telephone as I am always happy to give my honest advice and opinions
The four biggest mistakes people appear to make in selecting training courses and trading products are:
1) They go for whichever course makes the biggest promises.
People tell me that they purchased such and such a course or product because it offered for instance:
The biggest weekly pip count - (makes the most money)
No study was necessary
It was claimed that you only needed to trade for 5 minute a day with no real effort or work involved
The methods were claimed to be simple & “foolproof ”- In other words results were all but guaranteed
There are all sorts of ways of selling products and services to people but by far the easiest way is to just find out what customers want and then say to them
“I can give you that” …. "and with no work and no effort".
In trading it is very easy to know what people want.
Everybody wants to make a lot of money – quickly – with little or no effort – little or no study – little to no risk and starting with small amounts of initial capital.
These are the buttons that the unscrupulous marketing men need to push to ring your bell.
So when you see ads mentioning these (Make £1,000 per week in 5 minutes per day using our foolproof method starting with just £500) – duck ! and try to avoid getting hit by that marketing bullet.
If you do not duck you will always be disappointed.
They are simply using the very well known sales technique of “feeding back” or "reflecting back" to you what they know you want to hear.
Trading really is a great business – but – it is not free money, and those that tell you it is are at best disingenuous. You see this sort of thing all the time in the diet and beauty industries. Ridiculous unbelievable promises being made. “lose 5 stones in 5 weeks and still eat whatever you like” , “miracle wrinkle cream takes 10 years off your age – overnight “, “build muscles like iron in 5 minutes a day with no exercise and still eat all the chips you want”.
We laugh at these because we know from experience that the claims made are impossibly good. The problem novice traders have is that by definition they have little or no experience in this particular field of endeavour and hence do not know what is and is not genuinely possible.
This makes novices an easy “mark” for unscrupulous salesmen. Many of the ads you read concerning trading on the internet and in the junk emails you receive are using exactly the same sales techniques as the diet and beauty industries use ie worthless or very low value product that does not work sold on the basis of obviously too good to be true promises dressed up in clever wording that rings all your psychological bells.
The truth in life is that those making the biggest claims are almost always going to disappoint. This is because they are not attempting to sell on truth or value or service they simply know that if they make bigger promises than everybody else out there then a certain proportion of people will come to them rather than the more genuine products.
So avoid those making the biggest promises and most outrageous claims and follow the advice we have heard a thousand time before namely "If it sounds too good to be true then it is"
2) Purchasers do not seek to independently verify any promises or claims made by the vendors (ie they do no due diligence ) and simply take the vendors word for everything.
For instance would you ever buy a second hand car from somebody who claims it had only had one previous owner, who happened to be their 90 year old maiden aunt, without asking to see the Log Book (and maybe even the maiden aunt as well !) to verify this claim ?
Of course you would not ….. but ….. you will buy a course or trading product from a company that claims in an internet ad that
“Acknowledged super trader Fred Bloggs” shows you how to make £1,000 per week with no effort in just 5 minutes a day ”
Without attempting to verify the veracity of the claims.
So before clicking “buy now” perhaps your first question should be “exactly who has acknowledged this guy Fred Bloggs as a super trader ” quickly followed up with “where is the proof that these methods really have earned £1,000 per week” and indeed many other questions should follow.
Why do people fall for this? - Taking totally unsubstantiated claims at face value and not asking for any proof ?
Well around 60% of those that have subsequently attended my course confess to having done pretty well exactly this – often more than once . When I ask them why on earth they would do such a foolish thing they tend to say words along the lines of
"because I sooooooooooooo wanted to believe it was true"
These sorts of companies also often deliberately make it difficult for you to contact and speak to them direct in order to quiz and question them on the veracity of those claims.
They simply dangle a big juicy “easy money” Carrot in front of you then make it difficult or impossible for you to verify the claims.
They then wait for our natural greed, desperation or impatience to override our common sense and we make the purchase anyway because we "so want it to be true"
So if you are buying something based on emotions, and in particular the emotion of hope, rather than based on verifiable third party evidence and proof you are likely to be disappointed.
3) Confusing learning ABOUT trading with learning TO trade
Virtually all of the forex training courses out there are run by marketing men not professional traders (despite what they may claim).
This presents even the honest vendors with a very big problem.
Given that they do not really know how to make money for themselves in the markets how can they teach you ?
They get around this by not teaching you “how to make money in trading” but by teaching you simply “the mechanics of trading”.
By this I mean they will essentially regurgitate the contents of a £50 book on Amazon teaching you how to apply and “interpret”, for instance, moving averages, MACD, Fibonacci etc etc.
You certainly do need to be aware of this information – BUT – you will be paying a prohibitively high price for it.
Worse still even armed with this understanding of the “mechanics of trading” you will still be no closer to being able to turn that knowledge into making real money in the markets because you still do not know "how to trade profitably".
In fact you will be in a worse position than you were before attending the course because you will now have thrown £1,000 or more away and hence have less capital to trade with !
If trading if success simply was about buying when one moving average crossed above another or when MACD indicated a buy or sell then everybody in the world would be at home making millions. (ask for the mailing “does anybody make money”).
What you actually need are: Fully formed historically proven strategies - that have an identifiable underlying logic and demonstrable edge to them.
You need to know exactly where to enter, where to exit, where to locate stop losses, where to locate profit targets, how much to risk plus a multitude of other things to give you a full and complete picture of the business.
This information can only be provided by people that can genuinely make money from trading.
So don’t spend £1,000 + on a course that simply teaches you about trading - you are better off to spend $50 on a book from Amazon !
Spend the larger sums of money talking to people that can prove that they make money from trading and are providing you with fully formed evidence based trading strategies that have an historical track record of making real money in the markets
"If you want to make money - first find a man who is already making money and then ask him how he does it" Mark Twain
4) Novices assume that if the course/individual is well known /heavily publicised (No 1 on Google or you get a mailing each week from them) then it must be genuine and providing great value.
This simply is not true.
Indeed in my opinion some of the worst training courses on the internet are top 3 on Google or send out sales mailings every single week in an attempt to almost beat subscribers into submission.
The truth of the matter is often the reverse ie they have to advertise the product heavily because it has such little genuine value and for instance they get no word of mouth referrals.
The large Google advertising budget these companies often have also then helps to relegate any complaints and criticism to page 120 on Google ! – which of course you will then never see.
Some companies concentrate on constantly improving the quality of their products whilst others spend all their time and energy on marketing poorly conceived products.
The large UK companies certainly will not rip you off in the conventional sense of that word, however, they provide just a very watered down version of trading education. Essentially you are again taught pretty well what you could get out of a £50 book from Amazon mixed in with lots of “positivity” about how much you will make and how “easy” it all is.
They make their money from selling trading seminars (not from trading) and have to sell a lot of seats to each seminar each week to cover their costs – in the end that involves hyping the product and hard selling it to the unwary.
Generally they are linking this in with hard nosed "up-selling" of additional services or products. For instance you will turn up for your £3,000 course rubbing your hands in anticipation and the first thing they try and do is "up-sell" you a £20,000 "super trader" course !
The large companies cannot afford to give truly “honest” advice or turn unsuitable clients away because they have to sell to every “prospect” they can and of course you are dealing with salesmen - when did you last meet a salesman who said to you "sorry I cannot sell this product to you as I am sure it is not suitable for you"
In the end pressure to fill seats overrides integrity.
Most of the self proclaimed “Trading Experts”, “Chief Traders” etc have no demonstrable record of trading success other than from their own unsubstantiated claims.
If you just blindly take what these marketing men tell you at face value you will be disappointed.
“The more he talked of his honor the faster we counted our spoons ” – Ralph Waldo Emerson
Here are a few other warning signs to look out for:
Scams (or in the UK – more commonly courses/products offering appallingly poor value) are relatively easy to spot – here are some pointers:
- No proof the vendor is actually making any money in his or her personal trading – ie no personal Brokers trading statements.
- No long term history for the company or for its course /training package.
- Wild and clearly untrue and exaggerated claims of profitability – with not a shred of evidence to support the claim.
"Turn £100 into £10,000 in a month" – "starting with £1,000 earn £100,000 every year" - "spend just 5 minutes a day and earn a fortune" –" no effort required" – "no study required" – "guaranteed profits" – "90% winners" – "never a losing day" – “never lose” computer programme does it all for you etc etc. (honestly folks trading is a fantastic business but nothing is that great)
- Liberal use of words like “imagine” – phrases like “won’t it be great when…” . these are advertising techniques designed to make you move into a fantasy world where you do not question the logic or credibility of what you are being told. They are asking you to move into a universe where simply “believing” and “imagining” and “having faith” in an unquestioning way makes it come true Well it doesn’t – so don’t !
- A highly profitable business model - for them. Marketing men are lazy and therefore seek to make as much money as possible from as little effort as possible. Maybe a group seminar where you get 20 people all paying £3,500 each for a day ( so they pull in £70,000 for a days work ) or a short pdf book/course that costs nothing to print or mail out, or a very high priced 1-2-1 say £10,000 for a days tuition (yep I have seen them advertised at $65,000 for a day). All these people want to do one thing and that is make a lot of money with little or no effort and this is a warning sign. So ask what am I actually getting for my money. If you are paying £5,000 and all you are getting is 10 pages of notes – be warned.
- No direct landline contact numbers or using a mobile number are obvious warning signs.
- Also being unavailable to talk direct to you on phone so you can only communicate via email or maybe even not at all. This means you cannot question them in detail on particular points or make all the normal judgements we make about people in the course of a conventional conversation. In a live conversation we can pick up on subtle cues such as intonations, changes in pitch of voice caused by stress, pauses and hesitations when they do not know the answer, inconsistent answers etc etc. Also with email you cannot ask them lots of questions or immediately query and question their responses as you could in a telephone conversation. Only responding to emails buys them time to concoct their answers to any tricky questions that you may have asked. Just imagine if the Police could only interview suspects by email – how many convictions do you think there would be then?
- Any advertising copy that plays heavily to your hopes, desires or fears and desperation and is short on facts and long on fantasy. You know the sort of stuff 10 pages of emotion filled spiel and not a single meaningful fact to be found.
So what is the answer? - how to avoid the professional marketeer
Anybody that has googled Forex knows that there are thousands of glossy websites making all sorts of amazing claims – and – most sound very believable.
So the question is "How do I avoid buying worthless junk like so many others have done before me" ?
Well almost all of these purveyors are experts in marketing & selling – that is their real business and indeed where their true skills are – not in trading.
So rather than making our decisions based on their expensive websites and carefully worded sales spiel we need to verify the product from a different direction and try and corroborate their personal trading skills.
We have to approach it from this angle because in my experience, as a professional trader with decades of experience, it is literally impossible for a novice reading a half decent marketing sales “spiel” to know if such forex training courses or products are genuine or not.
It is literally impossible. – you are wasting your time trying.
The whole concept of marketing (as far as I can see) is deliberate misstatement and or obfuscation of information in such a way that the customer cannot see through it to the underlying lie – and these guys are experts at doing just that.
The only reason I know these forex trading courses and product vendors are lying is because my decades of experience tells me the claims they are making are simply too impossibly good to be true. (This has then been corroborated, since running these courses, by the feedback I have received from hundreds of students who have purchased products from such vendors) .
It is like somebody saying they have tuned a Mini motor car up so it does 800 mph. You immediately know from your experience that such a feat is impossible, but your 12 year old son or daughter (who has no real experience of cars) is very likely to believe it. Not just because of their youth but because of their lack of experience in that area.
A trading novice is in exactly the same position, they have no way of making these judgements because by definition they lack both knowledge and experience in this particular field.
Often they do not know what the correct questions are to ask which leaves them in the very vulnerable position of having to believe at face value everything that they are told..
So if you fall into this category forget about trying to judge the truth of selling messages made on websites or even during general sales presentations and conversations the marketing professionals will fool you every time - It is their job.
There is one thing all the marketing guys in the world cannot smooch and bull**** their way around – and that is furnishing independent third party financial evidence that prove they make money from trading. ie personal trading statements (I don’t mean testimonials from their brother !, I don’t mean videos from pals down the pub or paid actors, I don’t mean a bland statement “I am a great trader” or false titles such as “former chief trader” or “renowned successful trader” , I don’t mean an excel spreadsheet listing trades they claim to have made I mean printed financial statements from an independent third party financial institution ie a Broker.
It IS that simple – if they cannot provide this evidence then they don’t make money from trading so why on earth would you want to buy a trading product or course from somebody that cannot do it for themselves.
You would be better off asking them to teach you about marketing !……… a subject they really do know all about!
“If they don’t provide brokers trading statements they don’t make money from trading”
Finally if you are thinking "well that is all fine and very plausible but how do I know this guy is not just using Photoshop to create his own independent third party financial evidence" ?
Good question please see the mailing (“To Photoshop or not”) but I will give you a clue I have never come across a single vendor that does this either in the UK or the USA – not because they are too honest ! .. ……oh no no no ……but for entirely selfish reasons borne out of the vendors own desire to stay out of Court.
The bottom line is if you can find somebody that can prove they make money from trading by presenting independent third party financial evidence you are then 95% certain that they are genuine and will almost certainly be able to pass on valuable knowledge and insights to you.
"If you want to make money - first find a man who is already making money- then ask him how he does it" - Mark Twain