How to Spot a Fraudulent Stock Trading Course

It’s true. More people make money “training” people how to trade than actually trading. Can I prove this? No, but take a look at the ads your feed serves you if you so much as think about a stock trade. Who are all of these random overnight millionaires who not only know how to beat the market, but were able to get their Ed.D. to teach you?

Honestly, I don’t know how the American poverty rate is 11.8% when 95% of all traders have a training course.

Source: Wikimedia — J. R. “Bob” Dobbs, a fictional figurehead of the Church of the SubGenius and hallmark of the snake oil salesman

Stop wasting your money and your time. Here are some dead giveaways that your guru is nothing more than a failed trader trying to make his money back.

This Strategy Works 105% of the Time!

There is no hidden trading strategy that works all of the time. Good investors know when to apply the correct strategy to the appropriate situation. Picking one strategy out of the thousands that exist and expecting it to work every time is like trying to get through a day using one half of the alphabet.

If you are a new trader, you need to learn every viable strategy you can. You show your sophistication when you can deploy the right strategy at the right time. But you can’t deploy it if you don’t know it first, right?

I Turned $14,000 into $2.5 Million in 2 Months!

I’m not even saying this guy is lying about the returns — he might be telling the truth. But according to probability theory, the highly successful outlier must exist. He has to. The math cannot work out any other way. But if someone can easily 100X his portfolio in months, why not just do it again? Then do it again? $2.5 million is a paltry sum compared to what a guaranteed 100X strategy could produce. This person could literally take every dollar the Federal Reserve sees fit to print and make himself a world power. He just chose to stop and sell you courses. Make that make sense.

The trader who turned $14,000 into $2.5 million over 15 years is probably a better trader than the lucky gunslinger. Consistent returns over a long time span showcase a resilience to market chaos, which is teachable and doable. The strategy that worked for the lucky guy was a fluke for a moment in time. That moment has passed.

All You Need is This Indicator!

Speaking of moments in time that have passed, the Age of the Indicator is long gone. If you hear someone talking about putting an indicator on a chart and magically producing outsized results, run for the hills. Even the most precise indicators lag the market slightly, and this phenomenon will only get worse as Internet systems get better.

Indicators can be used for midterm swing trading and backtesting theories to find possible symmetry in future scenarios. But you need to know what those indicators do, and more importantly, what they can’t do before trusting your life to them.

I Trade on My iPhone While I Skydive!

There is no doubt that today’s technology can free a good trader from the constraints of working in an office. As long as you go somewhere with a good Internet connection and skills, you should ideally produce the same results. The problem with these programs is that they are selling you a lifestyle, not teaching you strategies.

You may need to spend some time in isolation in order to master market strategy and timing. If you are the kind of person who is easily distracted, you aren’t going to be able to trade during the music festival. Take the time to learn market basics before you put your mind through the strain of attempting to trade while simultaneously having an Instagram-worthy life. Instagram will be there waiting when you get good, no matter how long that takes! Traders never take a side, but I can promise you that!

Mastering the Basics

If you really want to learn how to read charts and make trades, Benzinga’s stock trading course gets down to the real basics. Properly trained, you can build your own successful trading personality over time. So if you decide to hock a course that sells the sizzle and not the steak, at least you will have the results to back it up.

While you are at it, don’t forget the Benzinga options newsletter, your premier source for timely and relevant strategies focused specifically on the power and flexibility of options play.

Do your blood pressure level and your wallet a favor — take the time to really learn the market the right way.