In the latest episode of We Are Funded Trading Plus, Simon and Jamie discuss common perceptions and practices in prop trading to help traders distinguish between what works and what’s misleading. From understanding the realities of trading glamorised on social media to the pros and cons of copy trading, they unpack valuable insights that both novice and experienced traders can apply in their journey. Here’s a breakdown of their discussions, packed with practical advice on how to prop trade successfully.
Is Social Media Misleading New Traders?
One of the core topics Simon and Jamie discuss is how social media can paint an unrealistic picture of trading. The consensus? Social media has always glamorised the lifestyle of trading, showcasing rented luxury cars and exotic trips to attract attention. This approach, while flashy, often misleads new traders about the true nature of trading.
Key Insight: “If it sounds too good to be true, it probably is. Always be cautious, do your research, and seek out content creators who offer a balanced view.”
While there are honest creators who share both wins and losses, traders need to be wary of those promising effortless riches. Following realistic examples is essential for understanding the ups and downs of funded trading.
Copy Trading: A Good Learning Method?
Simon and Jamie discuss whether copy trading is an effective way to learn how to trade. They agree that simply mirroring another trader’s actions without understanding the rationale behind their decisions is unlikely to teach valuable skills.
Key Insight: “Copy trading can provide confidence if combined with learning and mentorship, but copying alone won’t build the understanding needed for long-term success.”
New traders might find copy trading appealing for quick gains, but without grasping the why behind each move, their knowledge remains superficial. Building skills and learning from experienced traders in a more structured way is preferable.
Trading with Small Accounts and Risk Management
Another point of discussion is whether trading with a small account fosters better risk management. Jamie pointed out that while starting small might seem logical, it can often be frustrating when the gains are minimal.
Key Insight: “The balance lies in trading an amount that’s meaningful enough to trigger emotions and teach discipline, without risking too much capital.”
Trading with a meaningful yet manageable account size helps traders experience the emotions tied to gains and losses, which is crucial for building good risk management habits.
Are Traders Naturally Talented or Trained?
Simon and Jamie explored the age-old question: Are some people just naturally better at trading? They believe trading is a skill that can be learned, though certain personality traits may lend themselves to trading more naturally.
Key Insight: “While traits like calmness can give a slight edge, the right habits and discipline can be cultivated by anyone willing to learn and practice.”
Prop trading firms like Funded Trading Plus help level the playing field by providing structured programs that guide traders through a disciplined approach to trading.
News Trading: Risky or Rewarding?
Many new traders are tempted to trade during major news releases, hoping for quick profits. Simon and Jamie, however, emphasise the dangers of this approach. News trading can be akin to flipping a coin, with outcomes that are highly unpredictable and potentially disastrous.
Key Insight: “Trading news events might look appealing for fast gains, but the volatility often leads to impulsive actions and losses.”
Even in the context of prop trading, where risk parameters are tightly controlled, this strategy is not recommended due to its high risk and unpredictability.
The Role of Patience in Trading Success
Lastly, the duo debate whether patience is the most important skill for a trader. While Jamie leans towards patience as a cornerstone, Simon argues that while patience is vital, it must be paired with other skills, such as chart reading and trade planning.
Key Insight: “Patience is essential, but without the skills to identify the right trading opportunities, even the most patient trader will struggle.”
In trading, doing less can often be more effective. Avoiding overtrading and waiting for the best setups is a discipline that distinguishes successful traders from the rest.
Conclusion: Balancing Skills for Trading Mastery
This episode of We Are Funded Trading Plus sheds light on several myths and practices in prop trading. Here are some takeaways:
- Don’t Fall for Social Media Glamour: Seek realistic portrayals and learn from balanced content.
- Copy Trading Needs Context: Use it as a tool, but only if paired with learning and analysis.
- Choose the Right Account Size: Make sure your trading capital is meaningful enough to evoke real emotions.
- Patience + Skill = Success: Patience is key, but only if supported by strong technical skills.
- Avoid News Trading: It’s too volatile and can lead to impulsive, damaging decisions.
Funded Trading Plus continues to empower traders with practical knowledge and structured support. By blending patience with skill, and focusing on long-term growth, traders can position themselves for success in the evolving world of funded trading.