Don’t Trust Your Broker

This may sound crazy, but it’s absolutely true AND extremely important for you to understand. Your broker is there to take your orders and execute your trades. That’s it.

Your broker’s goal is to get you to make as many trades as possible. That’s how he makes his money, on trade commissions and fees. You don’t have to make a trade just because he wants you to. Your job is not to make him money, it’s to make you money.

He is not the one to take stock trading advice or analysis from. If he really knew how to trade, he wouldn’t be working behind a desk. He wouldn’t have to. He’d be taking his own advice and making lots of money!

If you’re a beginning trader, you can ask him questions about “definitions” of trading terms you’re unfamiliar with, prices of stocks, etc. That’s all good and well. But, dont let don’t him give you actual trading or strategic advice about what to trade and how to trade it.

The same goes for most of the “free” advice you’ll get out there, especially through the media and most financial institutions/programs. Often times, their ‘advice’ is driven by self-interest and greed. There are also many ’self-proclaimed’ experts out there. Often times, it’s these so-called “experts” that will drive you to the poorhouse. Don’t listen to them!

Unless the advice givers are ‘real-world’ trading experts, with the track record – and bank balance – to prove it, don’t listen to them. Run away fast, in the opposite direction, if someone “guarantees” that you will make money from a certain stock, mutual fund, or commodity. No one can predict the market. No one.

This may be very different from what you’ve heard before, or from what you believe to be true. Remember, to be successful in this game, you’ll have to do things differently than how most people do it. You’ll have to learn things that few people know. It will most definitely differ from the “popular” beliefs, but that’s what will make you money while most people will not.