What is a Trading Guru, Expert, Master, Mentor, Teacher, or Authority?
A real trading guru is someone with at least five to ten years of trading experience and an undistorted track record of consistent profitability. In my opinion, these are the two main requirements to be considered an authority within the trading space.
When people hear the term “trading guru”, they typically assume teacher or educator. But I would argue that the vast majority of real trading gurus (experts, masters, etc.) don’t necessarily teach or mentor anyone at all. Since they already have a proven process of making lots of money, they don’t feel the need to teach. They just keep improving upon their own skills and honing their craft.
This is why you should be immediately skeptical of anyone trying to sell trading education. Most real, legitimate traders simply aren’t spending their time creating courses – they’re focused solely on trading. So it ends up being marketers – the individuals that masquerade as successful traders with advertisements featuring fancy cars and mansions – that tend to sell trading education.
I’m not saying that there aren’t any good trading teachers and mentors out there because there are. They’re just extremely difficult to find amongst the abundance of fakes. Below I’ll share some tips on how to distinguish real trading educators from scammers.
The Rise of Fake Trading Gurus on the Internet – Especially Social Media:
Social media networks like Facebook, Twitter, Instagram, TikTok, and YouTube certainly have many advantages, but there’s no doubt that their existence has contributed to the ridiculous rise of fake gurus, especially within the trading and investing space.
For unscrupulous individuals, these social media networks become ideal platforms for tricking and funneling people into their schemes. With a rented Lamborghini, fake stack of cash, and some false promises, they can attract thousands of followers in no time. Then with their cringe-worthy facade of success, they start selling lousy courses for hundreds or thousands of dollars – with no refunds.
If you’ve spent even a minimal amount of time on one or two social media platforms, then you’ve probably seen the sort of thing I’m talking about. For example, the eighteen year old “life coach”, the nineteen year old “business mogul”, or the twenty year old “trading guru”. I truly wish I was making this stuff up, but it definitely exists. Not only does it exist – it’s spreading like wildfire.
Unfortunately, these fraudsters feed on our human nature – our desire to make fast, easy money and live a luxurious lifestyle. But it’s just a psychological trick. For those well-versed on how these kinds of scams work, it’s easy to spot and laugh at. But for those who don’t know any better, spending hundreds or thousands of dollars on some bogus course ends up being a sad reality.
Trading Education Sins – How to Know When You’re Dealing With a Fake Guru:
The fake gurus (aka marketers/salesmen) understand your desire for a “magic pill”. So they prey on that desire for instant gratification and immediate results in a number of flashy ways. But the truth is that there’s no real substance behind their claims.
Here’s a fairly comprehensive list of red flags to look out for in your search for legitimate trading education:
- An Obsessive Focus on Lifestyle and Results (Cars, Mansions, Money, etc.) Over the Actual Process and Skills Required.
- Any Sort of Income or Profit Guarantees. There Are No Certainties in Trading – Only Probabilities.
- Reviews or Testimonials That Highlight Short-Term Success (1 Single Trade, For Example) Instead of Long-Term Profitability.
- Trying to Trick You Into Thinking That Their Pre-Recorded Webinar is Actually a Live, Real-Time Webinar.
- Attempts to Increase Their Own Credibility By Association (Paid Pictures With Celebrities or Speeches at Renowned Locations).
- Offering Trade Alerts/Signals (Especially on Small Caps or Penny Stocks) and Recommending You Blindly Copy Them.
- Trying to Make Trading Sound Extremely Easy While Sidestepping the Core Skills Required For Durable Success.
- Extremely Volatile or Parabolic Equity Curves That Suggest a Lack of Risk Management or Distorted Profits.
- Disparaging Real Jobs or Telling You to Quit. You Can Still Learn, Train, and Potentially Even Trade With a Full-Time Job.
- Offering an Extremely Expensive Masterclass or Mastermind Group For an “Exclusive” Group of Students.
Using the List of Red Flags to Categorize Authentic Gurus From Fake Gurus:
On the whole, it’s extremely difficult to find even the authentic trading educators not showing at least one or two red flags. This is because the small number of honest and transparent educators tend to get drowned out by the large number of unethical marketers. Sadly, the truth coming from a real trading guru is dry and boring compared to the fun and exciting lies created by a fake one.
So in order to capture people’s attention, at least initially, real trading coaches sometimes have to work some lifestyle components into their advertisements – otherwise they wouldn’t get any attention. For example, the top learning program for beginner traders that I’ve come across so far is Thomas Kralow’s University Grade Trading Education. And even though some of his YouTube videos and advertisements display fancy cars, penthouses, boats, and watches, I still think that he’s a legitimate guru.
I say this because after the short introductions to his YouTube videos or ads, he quickly jumps into proper expectation-setting and building a strong mindset. He doesn’t make any income guarantees or trick you into thinking trading is easy. In fact, he does the opposite – saying that his program is rigorous and will take months of hard work. Does he lose out on students for being honest? Of course. But he also attracts a smaller, more committed, and serious group of traders with realistic expectations.
So the list of red flags above can be used as a guideline, but the existence of just one or two shouldn’t immediately categorize someone as a fake guru – it just means that you should be cautious and do more investigating. If you notice three to five red flags, there’s a good chance you’re dealing with a fake guru. Anything over five and you should probably run in the opposite direction.
Conclusion – Look Past Entertainment and Marketing For Education and Substance:
In order to protect yourself within the wild world of fake gurus, you have to understand how they operate. They fill you with unrealistic expectations by focusing on massive potential rewards instead of the proper process required to achieve it. It’s an attack on your psychological weaknesses. They feed you lies and toy with your emotions just to make some money.
But all their flashy entertainment and false marketing does is set you up for failure instead of success. The reality is that good trading is skills and process-based, not results-based. So if someone is trying to sell you on the lifestyle of a trader instead of mentioning the process (having a statistical edge and executing on it with consistency and discipline), then they’re flat-out fake.
The trickiest part about distinguishing real gurus from fake gurus is that results don’t always tell the full story. It can be difficult to differentiate luck and deception from skill. For example, a trader that runs an alert service can seemingly have a great track record of winning trades. But how much of that is distorted by the fact that thousands of people blindly follow them into each trade?
There are also instances where people do extremely risky things, like take their entire life savings and put it all into some random penny stock. No trading knowledge or skills are required to take an idiotic gamble like this. But by sheer luck, this sort of thing will work out sometimes. Should the person that makes a million dollars this way be able to call themselves a trading guru?
Overall, the trading educational space is a wild world full of fake gurus. But the good news is that you’re now armed with some helpful information to avoid them. On your search for legitimate trading education, keep your focus on building skills and developing self-sufficiency. The luxurious lifestyle the fake gurus try to sell you on simply isn’t possible without following the proper process.
Written by Matt Thomas (@MattThomasTP)