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If You’re Learning to Become a Stock Trader, Don’t Listen to These People:

If you’re learning to become a stock trader, be very careful who you choose to take guidance, recommendations, suggestions, advice, and tips from. This is an environment where the vast majority of participants, knowingly or not, don’t typically put your best interests first. Certain groups of people might not know any better, but there are also groups that are purposely trying to deceive you. Either way, what comes off as friendly or expert advice probably won’t serve you very well. It’s sad to see, but it’s the unfortunate truth.


You might be wondering how the truth is so hard to pinpoint when it comes to learning how to trade stocks. Regrettably, things have certainly become quite distorted, leaving people with a muddled understanding of how to achieve their dreams of becoming consistently profitable traders.  But it’s presumably for the same reason we see booms and busts in certain stocks, sectors, and even the market as a whole. These same market participants have a tendency to stretch things so far from the truth by playing follow-the-leader and monkey-see-monkey-do, that eventually things take a sharp, massive turn back toward equilibrium. Inevitably, bubbles have to burst. It’s my greatest fear, however, that the stock trading educational space will never return back to a state of balance.

The 3 Groups of People That Will Steer You Wrong On Your Trading Journey:

1. Your Friends & Family

Your friends and family fall into the group that probably doesn’t know any better. They think it’s fun to small talk and provide you with some hot stock tips, but they don’t really understand what it takes to have long-lasting market success. They might provide you with some entertainment and mean well, but they’re most likely oblivious to the true nature of trading. Because long-term, consistent market success doesn’t come from a “lottery ticket” or one big trade. In fact, around 70% of lottery winners end up going broke within just a few years. The same concept applies to traders, and if there were stats to prove it, I’m sure the numbers would be even worse. No matter what you might initially gain out of sheer luck or chance, you will eventually lose if your overall approach is compromised.

2. The General Group of Market Participants

This is another group that usually means well, but considering that over 90% of traders fail, you should be very guarded against what they have to say. If they’re not consistently profitable themselves, and chances are they aren’t, why would you take advice from them? We’re talking about people who are probably more obsessed with the potential results (the opportunity to make lots of money) than the actual process required to achieve that result. They’re in it for short-term emotional highs, the thrill of the action, at the expense of actually being consistently profitable. Even though they consider themselves traders, they keep coming back to the market and losing money – repeating the same negative, ineffective cycles of behavior over-and-over again. Sometimes winning trades happen, but they don’t have a repeatable strategy to speak of, at least not one they have the discipline to follow since they’re impulsive and irrational.

3. Traders With “Explosive” Returns

This is where deception often comes into play. It might seem obvious to try to locate the traders boasting on the internet about their “explosive” returns, and then try to follow what they do in the market, but there’s usually a hidden agenda to be concerned about. The reality is that if a trader has a real edge in the market, they usually don’t go around broadcasting it to the world because that would invalidate it. An edge is something you do differently in the market, so if too many people know about it, it will quickly dissipate. With that being said, if you see traders out there boasting about huge wins all the time, then: 1) they’re probably selling something, 2) they’re probably hiding their losses, or 3) they’re doing both. They might be trading, but they’re mostly marketing.

Another thing to keep in mind is that many services out there send “buy” and “sell” alerts to their subscribers, which skews trading results in favor of the service providers. It certainly provides a high level of transparency to send out these alerts, but there are major downsides to it. When the trader running the service enters a position and immediately sends a “buy” alert out to thousands of subscribers, it can quickly drive up the price of the security, giving the trader who initially bought and alerted it a massive and nearly immediate profit opportunity. The majority of subscribers, on the other hand, are usually late to the party and left holding the bag. Overall, alert services seem attractive because it sounds so simple to just be able to copy the exact trades of someone who has a great track record, but most people don’t really understand the dynamics of the process and how dangerous blindly mirroring can be.

What Nobody Talks About – The Mental Framework Required to Succeed as a Trader:

When it comes to trading, or anything in life for that matter, people have a tendency to take the path of least resistance. So they chase what seems like the easy way to “get-rich-quick”. They dig for the best newsletters that will provide them with enticing hot stock tips, shell out money for alert services thinking that they can get away with blindly mirroring, and constantly search for foolproof systems that promise the equivalent of no work for guaranteed profits. But all they really accomplish in this exhaustive search is make their path to consistent trading success harder and longer. In fact, learning the hard way is a consistent theme amongst traders.

What is Day Trading Psychology

As much as people think that their trading success will come from the watch lists, expert predictions, and alerts that they receive from other people, it’s simply not the case. Sure, these things can have some educational value in them, but they’re not the source of long-lasting trading success. It’s your attitudes, beliefs, values, and perspectives that truly dictate your behaviors within the market environment, and those behaviors are what dictate your results. It routinely gets overshadowed by all of the “shiny objects” out there in the trading world, but the proper mindset is the foundation of success. Unfortunately, over 90% of traders are impatient, fearful, and impulsive, and never recognize that they need to change, which results in substantial emotional and financial pain. The exclusive group of traders who eventually succeed, however, understand that internal changes need to be made in order to become more calm, confident, and disciplined. Overall, adjusting your mindset is the primary catalyst for achieving consistent trading success.

Do you recognize the psychological dissonance between yourself and true market characteristics? Change starts with self-awareness.

Learn More in the Trading Success Framework Course

Written by Matt Thomas (@MattThomasTP)

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Matt Thomas

Founder of, Creator of the Trading Success Framework Course & Trading Paradigm Skool Community, and Intraday Futures Trader Using Auction Market Theory & Profiling (Volume & Market Profile).


  • Michal Bahno says:

    I was thinking about becoming a stock trader since I want to have an additional source of income. As I was doing my research I came to the conclusion that it is more difficult than I thought it was gonna be. 

    Nevertheless, I still believe there is a way how to make some money being a stock trader. 
    You are absolutely right about the friends and family stuff. In many cases, they are from the 2nd group as well, and sometimes it reminded me of the saying I saw the other day that goes: If you want to buy a Rolls-Royce, don’t take advice from a Toyota Owner – or something in that manner. 

    As you saying 90% of traders are inpatient – I agree with you. It is pretty much the same amount of people in any other field as well.

  • Cynthia says:

    The short answer here is that there is no such thing as overnight riches and no there’s no substitute for doing your homework.  Obtaining the right mindset is key to achieving success.  Once that’s done, you don’t have to worry so much about self-sabotage and the rest will fall into place!

    • Matt Thomas says:

      Couldn’t agree more! It’s not about one or two big winning trades – those are fleeting. It’s about consistent success over the long term, and cultivating the right mindset is the foundation for long-lasting consistency and discipline.

  • Nedia says:

    As a consistently profitable trader myself, I totally agree with you. There are some people that you really cant take advice from, like your family and friends, as you mentioned because most of the time this group think you are gambling, so they do not take you serious. A lot of the so called trading gurus out there spend more time marketing than trading and make new traders believe trading is easy with their results. The best way for a new traders to learn, is to be patience in learning and treat trading as a real business. 

    • Matt Thomas says:

      Hi Nedia – you’re exactly right! Most of the time family and friends think trading is just gambling, which for many market participants it actually is, but it doesn’t have to be that way. It’s certainly not gambling for the consistently profitable traders.

      For losing traders, they don’t understand themselves, the market, or the true nature of trading, and as a result, they trade impulsively and irrationally, constantly blaming external forces for their misfortunes. For winning traders, on the other hand, they have complete awareness of their own mindset, adopt attitudes, believes, and perspectives that will serve them within the market environment, and take complete responsibility for their operations (treating it like a business as you say). The market is like a mirror, reflecting back our own thoughts, perspectives, and behaviors. When we think, feel, and act inconsistently and irrationally, the reflection is painful (inconsistent, erratic, and most likely negative results). But when we think, feel, and act consistently and rationally, the reflection is enjoyable (consistent, balanced, and most likely positive).

      In the end, it’s completely up to the individual trader to decide what they want their trading operations to be. After all, they’re in complete control of every trade they take, no matter what the reasons. So if they want to treat the market as a platform to gamble away their money, that’s their choice. But on the other end of the spectrum, profitable traders understand that they can actually stack the odds in their favor – becoming more like the casino as opposed to the gambler. Over a large number of trades, assuming they have a positive expectancy system (and the mental framework to execute that system with the highest degree of discipline!), they can almost guarantee profits for themselves. Overall, consistently profitable traders have structure, discipline, consistency, and think long-term.

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