News & Analysis

3 significant benefits of having an FX trading buddy

March 5, 2019

By Mike Smith

Let’s face it, trading can be a lonely occupation sometimes. Along with the hope of picking up a “hot tip”, this seems to be a key reason why trading forums are so popular.

Unfortunately many people leave such forums almost as quick as they join them, simply because many users are not particularly supportive and often seem to be fuelled by ego-driven posting. So, understanding that there are benefits from connecting with other traders, another option we’ve seen in action is to take on a trading buddy. This might be someone you know who has shown an interest in your battle against the markets, and they need not be the same level of experience as yourself. Indeed, it may be that they are only just beginning. But that shared experience can create a difference.

We’ve possibly identified THREE significant positives, and how trading buddies can not only increase your level of enjoyment when trading, but also reduce that “alone” feeling, and even potentially impact positively on results.

Consider:

1. Increased Accountability

The very fact you have someone close that you can share your experiences with gives a layer of accountability that you will never get when you are trading without someone else knowing what you are doing.

It’s easy to stray from whatever your trading “straight and narrow” is when no one is there to know. Logically, if you are sharing your experience of trades, those that go with you and those that don’t, there is one more reason to trade more consistently with your plan.

Beyond direct trading, there’s also the follow through in learning and system development that can be positively impacted upon by having someone else around.
Recognising the potential benefits of this layer of accountability is why many traders seek out a coach and invest thousands of dollars in such.

2. Shared learning and experiences

The benefit is based on the idea that “Two heads are better than one”. Whether it be a theoretical trading concept, understanding and testing a trading indicator that you are considering using, or simply having someone on hand to encourage and support you, or even celebrate when things go well, a trading buddy can positively impact all of these.

3. More efficient and effective trading system development

One of the critical tasks you face as a trader is to develop the systems that support your trading decision making. A staggering number of traders have no or incomplete trading plans, and no other systems in place that many believe are necessary.

Additionally, there’s the obvious benefit of measuring the success or otherwise of such systems and having a critical mass of trades as evidence that system changes may be useful.

Developing and testing systems together and getting evidence more quickly with two people working on getting that critical mass of trades are definite positives for having a trading buddy.

Making your trading buddy happen

a. Get one

There are more advantages to having someone local (although much can be done online) who you can physically meet. This can not only be more enjoyable but more productive. Ideally, someone you already know and whose opinions you generally trust would seem logical. Experience is less important than the above as we can help (see below) in bringing someone up to speed. Watch also for LIVE events happening across Australia we are running this year. One of the key objectives of these is to facilitate networking with other trades. Also, check out Inner Circle if you are not already a member. Perhaps put the word out you are interested in having a trading buddy and see if anyone is interested.

b. Get them trained

If your prospective buddy is someone who has simply expressed interest in trading but not yet taken the plunge, point them in the direction of “First Steps”, our free education course. It is designed for new traders and enables fast track learning. Get them up and running with a demo platform and of course ultimately a live trading account. If this is of interest, then connect with us ASAP and visit the FREE education page on the website. If they already trade, get them involved in “Next Steps” and “Inner Circle” as appropriate, and direct them to the page on the website.

c. Set some ground rules

Any relationship needs them! It doesn’t have to be a formal session, just a simple ‘how can we both make this work’ conversation. Documenting what you’re doing and writing plans for action can always help get the most out of it for both of you.

We see some great potential advantages for you and your buddy and, of course, will facilitate that relationship through education and support as much as we can.

Your next step is to consider whether the advantages we have discussed would be right for you and of course if they are, take action.

This article is written by an external Analyst and is based on his independent analysis. He remains fully responsible for the views expressed as well as any remaining error or omissions. Trading Forex and Derivatives carries a high level of risk.