The Role Of Trading Communities And Mentors In Learning And Improving Trading Skills
It’s no secret that trading is quite challenging. It requires a good understanding of how financial markets work, awareness of the events that can affect the movement of a market, and knowledge about various tools and indicators that are useful for identifying the direction of a trend.
Because of this, beginners might feel lost and even intimidated by trading and hesitate about moving forward. However, only a few inexperienced traders know they can join trading communities or find a trading mentor to improve their skills and hear helpful advice.
In this article, you’ll learn what trading communities are, who a trading mentor is, and how they can help you become a more successful trader.
Why are trading communities and mentors important?
It’s true that there are countless educational courses, lessons, videos, and guides about financial markets and how to trade them. Nevertheless, trading is generally regarded as a skill that requires a lot of practical experience to master. Theoretical knowledge is essential for getting the basics of trading, but starting trading in real life is nowhere near what you usually read in textbooks.
That’s why many traders don’t know where to begin. However, beginners in any craft and profession have anxiety when they first start, so this is nothing new. What always proves helpful is asking for advice from others.
Joining a community of traders who know what they are doing and are willing to share their experience with others is a great way to get helpful advice and learn more about the practical side of trading. And if you’d like to get more detailed and personalized advice, you can find a trading mentor who will guide you through your first trades and show you what you did right or wrong in each trade.
Trading communities: how they work and what they offer
When you hear the word ‘community,’ you generally imagine a small village where everyone lives in harmony and works together to help each other. Well, a trading community might be far from a literal village, but the sentiment behind it is the same: this is where traders gather to help each other.
A trading community is usually an online forum where traders can join to share their experiences, ask questions, discuss the latest trading news, and find helpful tips and tricks for successful trading.
Trading communities are also excellent places for beginners to learn more about trading and get valuable advice from experienced traders. Some can even provide details about their trades to allow beginners to mirror them and learn to trade in practice.
Benefits of joining a trading community
Trading communities attract a lot of traders, and not all of them are beginners. The reason for this is that there are a lot of benefits of belonging to a trading community. Here are just some of them.
It’s easy to become discouraged when you face a series of unsuccessful trades and lose the motivation to continue. It’s even easier to become too comfortable after a series of winning trades and lose the motivation to improve even more.
But being in a trading community is a good remedy for both extremes. Seeing the success of other traders is an excellent way to find the motivation to continue trading and improving one’s skills.
Getting objective opinions
Trading is stressful, and many traders fall victim to their emotions. Emotions can cloud their mind and prevent them from thinking objectively.
Thankfully, that’s what you can use trading communities for. Traders come to these spaces to share their insights and findings, discuss potential outcomes, and give explanations behind trading decisions. This can help you learn more about the current market conditions and stay objective in making decisions.
Gathering market intel
In recent years, trading communities have mainly influenced the markets, increasing the impact social trading leaves on prices. Joining a trading community can help you learn which assets are currently popular with other traders and deserve your attention.
Free learning resources
Following trading communities and reading other traders’ analyses is a great way to improve your skills without paying for additional trading courses. Even if you don’t get detailed information about the current market situation, reading about how traders use various tools to determine their next steps can help you learn how to use them in trading.
As you see, trading communities can benefit you in many different ways.
Choosing the right trading community
Finding the right trading community is challenging with how many of them there are. To choose the best trading community for you, research the following:
- Type of securities. Each trading community generally focuses on a minimal number of financial markets. If you trade Forex, you’ll unlikely find stock-centric trading communities particularly useful.
- Detailed explanations. You won’t learn much if traders from a potential community are ambiguous about their trading experiences. Finding trading communities where traders can honestly share their knowledge is important for becoming better in trading.
- Friendly environment. It’s no secret that the anonymity of the Internet made it easier for people to lash out at others without consequences. Unfortunately, some traders act like this as well. For your emotional well-being, it’s important to check how a trading community treats new members.
- Strong team spirit. Many traders come to trading communities to join their efforts to build a successful trading strategy. A community that is focused on helping others find trading opportunities is what you should be looking for the most.
Mentors: what are they and how they help
Another way to learn more about financial markets and improve your trading skill is to find a trading mentor. A trading mentor is an experienced trader who helps new traders understand how the markets work and apply their theoretical knowledge in practice.
Mentors are different from trading teachers: they don’t monitor each and every step a newbie makes. However, they do offer personalized advice and gently guide their apprentices through their first trades, helping them learn the ropes and overcome inevitable mistakes.
Advantages of having a trading mentor
Many pro traders attribute their success to their trading mentors, and for a good reason. There are many advantages to working with a mentor, and we’ll look at some of them.
Improving your chances of success
Trading can be hard to manage for beginners. For example, about 90% of day traders lose their money and quit altogether. However, while trading mentors don’t eliminate the chance of losing entirely, having one has helped many traders learn faster and make fewer mistakes.
Helping with a trading plan
Most novice traders make the mistake of trading without a plan or strategy, which sooner or later ends in disaster. A trading mentor, however, can explain the importance of a trading plan and help new traders learn how to build a trading strategy, preventing them from making one of the most common mistakes and saving them money.
Making mistakes is unavoidable when it comes to trading. It doesn’t make them any less upsetting, though. Some traders even quit trading when they can’t deal with their mistakes.
Having a mentor can help beginners process their emotions and overcome their mistakes. A mentor can show traders how to identify their errors and ensure they never repeat them.
When new traders get the hang of trading a particular security, they find it hard to switch to something else, even if it might bring them more profits. Trading mentors can encourage their apprentices to step out of their comfort zone and try different techniques, strategies, and securities, which in turn helps them grow as traders.
Finding the right mentor for you
There are many important factors to consider before choosing a trading mentor.
- Specialty. No matter how obvious it sounds, it’s important to choose a mentor that is experienced in the markets you want to master in order to receive the most from trading mentoring.
- Credibility. If you’re looking for a mentor online, you need to be aware that you may encounter a scammer, especially if the mentor in question takes money for their trading mentoring. If you find someone you want to work with, research their background and look for reviews from other traders to avoid scammers.
- Connection. You can find the best mentor in the history of trading, but if you don’t feel comfortable asking them questions that bother you or if they don’t treat you with respect, it’ll negatively impact your trading. Finding a mentor with whom you can connect easily is also very important for your future success.
Combining trading communities and mentors for maximum benefit
As you see, trading communities and mentors are slightly different. While trading communities focus on sharing general information about trading, trading mentors offer personalized advice, though sometimes less diverse. But it doesn’t mean you can’t use both to improve your trading. Learning the ropes with your trading mentor and then reading analyses from a trading community to find trading opportunities can help you learn faster and improve different trading skills.
Now you know how much trading communities and mentors can help you learn faster and make more profitable trades. If you ever feel lost, don’t hesitate to ask other traders for advice. Sharing knowledge has always been essential to human culture, and traders are no exception. As the saying goes, united we stand!