Feeding our hunger for knowledge
Published in the The Australian - January 2012
By James Dunn
IT has never been easier to be a sharemarket trader or investor, with quick and cheap access to the market through a group of online brokers all competing furiously for customers.
But even though access to the sharemarket has been well and truly democratised by the internet, knowledge and understanding of the market and how to use it still needs to be acquired by the individual.
A plethora of trading software systems using both technical and fundamental analysis is available, which will give you signals on whether to buy or sell stocks, indices, currencies and commodities.
You can trade shares, contracts for difference (CFDs) over shares, indices, currencies and commodities; options, futures contracts and warrants, margin FX (foreign exchange) 24 hours a day, with varying degrees of leverage.
You have the same access to the market as a hedge fund: in effect, you can be a hedge fund. Advertisements tell you that you can make money by trading currencies or CFDs, in just a few hours a day. It could not be easier.
If you know what you are doing, that is. But how do you get to that stage?
A thriving market in seminars, courses, books and online education exists to fill the voracious need of Australia's army of share traders and investors for education and information.
"This information can range from free for example the information on the Australian Securities Exchange (ASX) website to two-to-three-day workshops costing $5000 or even more," says Jason Humphris, chief executive officer of Event Management International, which runs the annual Trading & Investment Seminars Expo in Melbourne, Sydney, Brisbane and Perth.
"There has been an absolute proliferation of seminars and courses over the last few years. The challenge for the trader or the investor is to work out who to trust, because it's fair to say not every seminar or course that is advertised as something that will help you make money is going to do that. A lot of them are more designed to make money for their promoter."
Humphris says a good starting point is the ASX's comprehensive range of online share courses and webinars at http://www.asx.com.au, as well as the two in share investor organisations, the Australian Investors Association (AIA) at http://www.investors.asn.au and the Australian Shareholders' Association (ASA) at http://www.australianshareholders.com.au. The ASA leans more to the traditional lecture-style seminar; the AIA is more an online reference. For technical analysis practitioners, he says the Australian Technical Analysts Association (ATAA) at http://www.ataa.com.au has a wealth of content.
"If you're looking for independent, credible, good-value content, these associations are a good start," he says.
Most online brokers and CFD providers offer education to help customers become better traders: the last thing the brokers want is for customers to lose money and give up trading, because then they do not generate revenue.
Customers new to online broking are provided with free research, educational material and portfolio management tools, as well as simulated trading for practice before risking money.
Increasingly, the online brokers and CFD providers see giving their customers the tools and the knowledge base that they need empowering people to inform themselves, be self-directed and become better at trading as ways to differentiate themselves in a highly competitive market.
Investors who want to explore the field beyond what their broker or CFD provider offers still don't have to spend money.
There is a mass of information available for free on the internet: putting the name of any investment concept or fundamental analysis term or technical analysis indicator into a search engine will come up with voluminous amounts of information posted online.
Free investment websites such as http://www.thebull.com.au, http://www.motleyfool.com.au or http://www.australianstockreport.com.au can also be handy references. Self-managed super fund (SMSF) operators who want to improve their knowledge on both investment and fund governance can find a lot of helpful material at the Self-Managed Super Fund Professionals Association of Australia (SPA A) website at http://www.spaa.asn.au and the SMSF Investor website at http://www.smsfi.com.au.
Investors who want to take their knowledge further can consider a course: one often recommended for beginners is the Interactive Trading Course offered by Your Trading Edge magazine.
Priced at $399, this multimedia course sets out basic strategies in both technical and fundamental analysis.
At the other end of the scale are courses that suit people wanting to be professional traders, for example the Diploma of Share Trading and Investment, offered by Wealth Within, which will set you back $5795 this is the only accredited sharemarket trading course in Australia, recognised through the Australian Training Quality Framework (AQTF).
Similar is the Diploma of Technical Analysis offered by the ATAA, in association with global education provider Kaplan Professional.
This qualification is professionally recognised by employers in the financial services industry, but also suits traders who want to manage their own funds with professional-level breadth and depth of knowledge.
