Wednesday, 16 October 2013

Demystifying the Myths about Financial Trading with the Academy of Financial Trading

When it comes to financial trading, it really is like a game of Chinese whispers isn’t it. We start with one thing that’s relatively simple, then somehow it’s misheard, misheard again and misheard one final time until by the time it reaches our ears it in almost no way resembles what it actually is. That’s what tends to happen to the facts of the financial trading game as they circulate through the community, growing taller and taller as they pass from ear to mouth to keyboard to chat room back to ear.

This is how a culture of myth and legend has come to grow around the Stock Market to such an extent that it is now so enshrouded in fable that it obscures the truth. Don’t get us wrong, we like a little bit of mystery, but when it grows to such an extent as it has with Financial Trading, it skewers people’s impressions and distorts the real image. 

This is why Financial Trading has gained a reputation over the years that it really doesn’t deserve. Understandably, this can turn someone away from going into Financial Trading, but it shouldn’t, since most of the time the time this second hand information isn’t even accurate. So, what are a few of the most common myths about Financial Trading?

Financial Trading is Just like Gambling

We cannot begin to tell you how often we hear this one, and let us say here and now, it is very far off the mark. Whilst gambling is a past time of chance, dependent more often than not on pure luck, Financial Trading is a discipline which involves carefully assessing and studying the potential options and using variables to determine when to buy and sell shares. It requires the use of every last mental faculty you have.

It’s a Game for the Rich and Brokers

It’s certainly the stereotypical perception of the Stock Market; that’s it’s the playground of the millionaires, however, the reality differs. The onset of internet market trading has really opened up the market place, made it much more accessible to the average person, and with a little know how anyone can start trading.

What Goes up Must Come Down

It’s a fact of life that there are ups and downs, hills and troughs, and this, along with popular rumour, has led to the myth that when a stock goes up, it’s only a matter of time until it goes down. This law of physics isn’t the case, there’s no rule of thumb you can use to tell which way a stock will go, you can only assess the situation and use the facts you have at your disposal to make an informed decision.

A Little Knowledge Goes a Long Way

A lot of people seem to be under the illusion that if you have ‘some’ knowledge and a hunch then you’re onto a winner. This couldn’t be further from the case; you have to have a clear understanding of what you are getting into, because if you don’t, you will at some point make an error in judgement based on a lack of information that could have disastrous consequences.

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