Trading – Where to Start, Part 1

So you want to trade. You’ve seen or heard about it and you want to find out what makes the financial world tick. Whether you’ve never bought a share in your life or if you’ve been diligently handing your money over to your financial advisor each month, it’s always a good idea to take an active role in your personal investments.

For the experienced investors/traders out there, this post will seem rather familiar, but for the uninitiated, this should give some simple and practical steps to becoming a better investor and perhaps one day, trading for living.

I’m going to set out a few points to get you started. Like anything worthwhile in life, it takes hard work and dedication to become a successful trader. If you put in the time and effort, there is no reason you can’t do what millions of other investors do each day.

These simple steps will get you started:

  1. Read, read and then read some more
  2. Open a ‘paper trading’ account with a reputable broker
  3. Find a mentor
  4. Learn from the best
  5. Take a class
  6. Practice, practice, practice

One golden rule that you should realise before you even start, is that trading is not a ‘get rich quick’ tool. Trading is a long hard slog where you will be beaten and humbled by the markets and hopefully your skill and hard work will allow you to get ahead. Trust me, there will be loses but it’s how you deal with it and what you take from those loses that will make you a good trader.

Each week, I’ll go into details on these points. The first and most important of all is acquiring knowledge. This is the foundation on which the rest your experience will be built. If it’s not solid, the rest will be weak and of little use to you. Trying to invest or trade without the necessary grounding, will end up costing you a lot in time, effort and certainly money. This is not what most people want to hear, but if you are serious about trading, then you can’t go wrong with reading before you even think of placing your first buy order.

Read, read and then read some more

If you have limited knowledge and understanding of finance, economics, markets and share trading, the best place to start is with reading. Read and consume any information you can lay your hands on. There are thousands of books and free material online. A simple reading list for beginners should include:


  1. The Complete Idiot’s Guide to Investing, (2006) by Debra DeSalvo, Edward T. Koch, Joshua Kennon
  2. The Complete Idiot’s Guide to Economics, (2003) by Tom Gorman

Note: Don’t be fooled by these names. The “Complete Idiot’s Guide” series is an incredibly useful and power tool and it’s always good to brush up on the basics, even for experienced traders.

Fun reads: (and no, watching the movies doesn’t count)

  1. Liars Poker (1989) by Michael Lewis
  2. The Big Short (2010) by Michael Lewis
  3. Wolf of Wall Street (2007) by Jordan Belfort
  4. Rogue Trader: How I Brought Down Barings Bank and Shook the Financial World. (1996) by Whitley, Edward
    Flash Boys (2014) by Michael Lewis

More factual books:

  1. Reminiscences of a Stock Operator by Author: Edwin Lefèvre
  2. Market Wizards Author by Jack Schwager
  3. The Intelligent Investor Author by Benjamin Graham
  4. The Little Book That Beats the Market Author by Joel Greenblatt
  5. Way of the Turtle Author by Curtis M. Faith
  6. Pit Bull: Lessons from Wall Street’s Champion Day Trader – Book by Amy Hempel, David E. Morine, Martin S. Schwartz, and Paul Flint

The reading doesn’t stop there. Get onto free financial news services and read daily. There are many out there (here are a few):

  1. Local newspapers: Business sections
  2. CNBC
  3. Seeking alpha (more advanced)
  4. Bloomberg


As with anything on the net, there are lots of useful free information sites and a lot of toxic rubbish to avoid. Here are some reputable resources:


That should keep you busy for a few months and once you’ve gone through that and still feel that financial markets are you, move to the next step.

Until next time…

G. Gekko


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