How do you become a great trader or investor? Must you shell out thousands on a course, or can you learn the art by going it alone?
Talk to anyone in the investing world, and they’ll surely give you a different answer. While some investors praise the merits of attending a structured course, others recommend saving your pennies and buying a couple of key educational books instead.
There’s no shortage of stock market investment courses and seminars addressing equities, contracts for difference, futures, warrants and options. Some are free, while others cost thousands and span over several months.
62-year-old grandmother Jackie Dines, of Perth turned to an online course after losing money as an inexperienced investor. “I used to run a boat business and didn’t know a bull from a bear,” says Dines. “I became interested in the market when everyone seemed to be making easy money prior to the tech wreck. After losing about 80 per cent of my portfolio, I decided it was time to educate myself.
“I do a lot of homework as trading is my job since retiring. Sharemarket trading requires commitment and discipline. It’s like running your own business. I’m doing very well, but the harder you work, the luckier you get. The sharemarket is a wonderful way to keep your brain active. I regret I didn’t discover the sharemarket earlier in life, but it’s never too late to start.”
David Harte, Pro Trader managing director, says his web-based education program sells for $2,450 and covers the first 12 months. After that, members pay an additional $660 a year for the sharemarket education software, data, stock recommendations and advice. Harte says: “Some people say it’s easy to make lots of money in the sharemarket, but I can tell you it isn’t. It takes a lot of hard work. We provide the trading strategies, computer software and identify buying opportunities, but it’s up to members to take advantage of what we offer. Members who do our program generally trade profitably in the market, but there’s no guarantees.”
Harte says too many company websites offering stock market education do not disclose the price of courses online. “You sometimes have to go to a free seminar to find out how much courses cost. If you’re proud of your product, prices should be disclosed on the website. I’ve actually rung competitors and requested a price for their course, but they wouldn’t disclose it. Rather, they wanted to sign me up for a free seminar.”
At $2,500-$5,500 a pop, it’s little wonder some are reluctant to disclose the price.
Glenn Manning, of Canberra, paid $5,495 to do another online course. Manning, 32, gained a diploma in share investing after recently completing the course in nine months. Manning went down this path because he was forced to give up IT consultancy work after a car accident left him a quadriplegic. “Before I did the course, I didn’t know much about stock analysis. What the course taught me was how to clearly analyse the technical and fundamentals of a stock. I also learned about how to stgelop and manage a share portfolio.”
Those seeking a basic understanding of either shares and derivatives can attend free seminars so they can get a feel for what they’ll get with the paid course.
CompareShares spoke to Mark Heffernan and Hayden Kerdel after they recently attended a free Optionetics seminar in Melbourne. Both say the seminar on options trading was informative, but they declined the opportunity to sign up for a two-day course. “We heard about put options, call options, volatility, leverage and how much money could be made in options trading.”
Kerdel says the free seminar was informative, but says the key investment strategies are only found in the paid course. “They’re not going to reveal their key investment strategies for free.”
Optionetics general manager Wayne North says the two-day options course costs $3,995, but people are entitled to repeat the course as many times as they like for free. North points out that some people do the course two or three times because they don’t fully understand options trading and strategies the first time. And others repeat the course for free to learn the latest options strategies best suited to changing sharemarket conditions.
Michael Dempsey, of Budgewoi in New South Wales has completed the Optionetics course six times – the past five times for free. Dempsey, a financial planner, says: “Every time I go, I learn something new about options trading because the market is always changing and so do the strategies.” Dempsey says the two-day course presents an opportunity to meet and learn from other people interested in the subject.
Dempsey initially attended the free seminar after he found reading books on options trading too complex. “The books I read didn’t cover the basics very well,” he says. “Then I went to the free seminar, liked what I heard and signed up for the course.”
There are plenty of people in the finance industry who remain sceptical about stock market courses in general and regard them as little more than a money making exercise for the operators. John Curry, of the Australian Shareholders’ Association, says if the operators are that good at making money from shares and derivatives, then why would you advertise it? Curry says what starts as a free seminar can run into hundreds and sometimes thousands of dollars. Curry says: “I suggest you could do better with some selective reading. There is no substitute for understanding a particular stock.”
Stockbroker Mark Goulopoulos, of Tolhurst, feels the same way, saying that people tend to be “very pumped up” soon after attending stock market courses. “And what I’ve found is that they usually want to start trading options, like immediately. If everyone owned the holy grail of investing, I don’t think they would be sharing it.”