Over the past year I've become interested in investing. I keep read how important it is to develop your own strategy, and to know your edge. I've also read several successful traders/investors with very different strategies and approaches. There is a lot to learn. What are the steps to developing a trading strategy? How to learn where to start? Fundamentals, technical, cycle traders, swing traders, etc. the list goes on. And then after that which one works well with my psychology. And finally developing my own strategy so that I can have faith in it. Reading has helped, but reading without application it seems pointless. So, how to go about practicing, developing strategies and learning so I can improve.
You can test and develop strategies by paper trading. Not sure who your broker is but TD Ameritrade has the Think or Swim platform that can be opened up in paper money mode to work on strategies without risking actual capital. In developing a strategy that is going to depend on what your overall objectives are. The younger you are the higher risk you might be willing to take on. Length of holds also impact strategy.
Thanks Jerry, and great sig. s the path more or less: Continue Reading/Learning. Write down Ideas. Trade on the Ideas/Systematize. Refine and repeat? I guess I'm surprised how self driven it is. With most subjects there is a way or path to go about learning them.
You nailed it right there! If there was a clear path, there wouldn't be a market to trade in because everybody would be on the same path. Take solace in your frustration with the learning curve as an indicator of market inefficiencies. No matter what your edge ends up being, we're all exploiting these inefficiencies. [And, if you will, imagine trying to figure all this out in the pre-internet days when the would-be, self-taught trader like yourself pored over stock price-history tables in the library, purchased real-time quotes delivered by pager, and had to call in our orders for $35/trade back in the 80s and early 90s. America On-Line, Datek, and E-trade turned traders' worlds upside down for the better.]
