How to find a trading mentor and why you need one
When looking for the holy grail of trading, many people spend thousands of dollars on courses, seminars, strategies, books and of course trading capital trying to become consistently profitable. While some of these products can help, I still think they are not enough for most of us. Why? Because trading is a mental game and to teach one's mind, you need three important components:
- Practice
- Mentorship
- Accountability
Practice
Practice takes care of itself. If you are trading every day, you will be practicing already. You will be building habits, good or bad, they will determine your faith. This is obviously an important step to consistent profits, however, practicing without proper mentorship can jeopardize your career and your profits. Let's start with an example.
You bought a trading book and read it 5 times. You are ready to play that strategy from the book. You buy some stock and lose big. You know that strategy works, you believe in it, you have been backtesting it for 2 weeks on demo mode. You buy it again and lose big again. Now you are mad at yourself, mad at the market and mad at the book. Your mind is clouded with negative thoughts and chemically imbalanced with adrenaline and cortisol (stress hormone). You continue to trade and continue to lose and bang...your worse trading day. You feel horrible and think about quitting. Everyone I know had a day like this. Without mentorship, you are all by yourself to figure out how to overcome this day. Typically you end up having many days like these because no book or course can lend you a hand to hear what you needed to hear.
Trading Mentorship
A trading mentor doesn't have to give you a winning strategy. We are not talking about trading rooms or live chat with trading calls either. Far from that. A trading mentor's job is to give you sound, practical advice based on experience so that when things get tough, you will be prepared to overcome them. More on trading mentorship below.
Accountability
While trading, it is so easy to lose your mind, control, and discipline because we are all emotional creatures. The best traders don't sweat over wins or losses big or small. They trade as mechanically as possible because they earned that right. To earn it, they learned how to deal with their emotions. It takes a long time. A trading mentor not only shortens this time but also offers something that perhaps can be even more important to you, accountability.
Accountability is having someone on your side watching over your shoulders and your moves. Knowing that someone will be seeing your results at the end of the day/week/month can drastically increase your trading discipline, because you know someone might yell at you if you don't respect your trading rules like your stops. Think about all the yelling your teachers and parents did to you. Eventually, you get it. The point is to get it faster and properly.
Ultimately, you are responsible for your trading results regardless of what your mentor tells you to do. You push the buttons, you make the calls. A trading mentor should not be blamed for your losses as long as your goals are aligned with theirs.
How to find a trading mentor
Many people think that mentors are scammers. Most of them really are! Their goals are not aligned with yours at all.
Here are some ways to spot a bad mentor.
- They will give you trading calls. That's not mentorship, that's a trading call service.
- They make promises. True experts know that profits are never guaranteed.
- They won't show their own results. I am not talking about financial results, but they don't disclose their trading strategy, sample real trade statements or even metrics.
- They try to push their way, their style, their personality into your trading routine. Every one is different. Some people are aggressive, some are conservative for example.
Here are some ways to spot a good trading mentor
Finding a mentor can very challenging because most of us assume that no one in the right mind would stop their profitable trading business to help someone they don`t know. Mentors have many reasons to help someone.
- They could be bored. Trading can be boring after a while.
- They want to genuinely help the community grow.
- They want a challenge. Coaching someone to success is not easy, traders love challenges.
- They feel better. Pushing buttons all day can make you feel purposeless.
- Helping someone might be their next step in their evolutionary self.
- They charge for it. Charging can be beneficial to both sides because mentors can enjoy the extra income while mentorees become more diligent and take mentorship more seriously.
Trading mentors don't have to be profitable or active in the markets, but they must have a successful track record of many years in order to mentor someone. Experienced traders have been through many ups and downs, overcoming many market types, strategy adaptations, and emotional swings. These lessons are very important to anyone that wants to succeed whether in trading or life.
I found my mentor on a trading forum back in 2006. It made a huge difference. There were countless pieces of advice that shortened my learning curve dramatically. Over the years, I've mentored almost 100 traders. Mentorship is not the only and ultimate thing that will make you profitable, but it is one of the main pillars to success.