A study was done that tested whether monkeys throwing darts on a dart board, which then correspond to stocks, could have a higher average payout ratio than professional stock brokers. As it turns out, the monkeys consistently beat out top traders.
This demonstrates two things:
(1) The people who are supposed to know the most about the market still have a difficult time mastering the complexities of the market.
(2) It’s okay that you don’t know everything about trading stocks.
While some may be discouraged by the monkey example and the first point, there’s still a lot of regularity in the market that can be exploited for profit. To do this, you should at least know the basics.
When I started trading stocks, I was overwhelmed at how much there was to know and how complicated it all seemed. Once I realized that the masters don’t even have it all figured out, it actually was a bit of a relief. Since I had no one to teach me, I began a long journey of educating myself. This entailed reading countless books, frequenting stock forums, and putting in hundreds of hours analyzing charts and data in an attempt to make some kind of sense out of all of it.
When I started to have some success in the market, my friends would invariably ask me how I got started, and how I was making so much money. That conversation usually took several hours of me talking at rapid pace, most of which they probably didn’t understand or retain. Instead of tirelessly and inefficiently reciting this now memorized speech, I simply wrote it down.
This guide is intended to teach beginner traders the basics of trading stocks.
Wayne Gretzky once said, “You miss 100% of the shots you never take.” This is also true in the stock market. Although learning the complexities of the stock market can be daunting, and the fear of losing all your money can be paralyzing, don’t be afraid to try. If you have the right discipline and a little luck, you can make a lot of money.
To read the full guide for free, please visit my Scribd profile.
Article by Edward Mullen
Host of The Edward Mullen Podcast