Day trading is a tough career. Whether you're new to the field or an experienced trader who wants a support network of other professional day traders, finding a day-trading school that offers courses and mentoring is an efficient way to get the education and tools required to succeed in the markets. Many day-trading schools offer online courses, video conferencing, in-class or group sessions and/or personal consultations. Each school focus on different markets, such as the stock, futures or forex market, providing their own strategies and mentorship programs. The quality, price and support offered varies dramatically from school to school. With that in mind, here's what you need to know about day-trading schools so you make the best choice for your situation and preferences. Popular schools for those seeking to day trade the stock, options, futures or forex market are also discussed.
Picking a Day-Trading School
One of the first things new traders look at when picking a day-trading school is the cost of the courses and mentorship. While cost is an important factor, it shouldn't be the only factor. Most day traders will lose much of their account very quickly if they jump into day trading without guidance or research. If day trading the stock market, that potentially means losing a large chunk of $25,000 or more -- the minimum account balance required to trade U.S. stocks, as imposed by the Financial Industry Regulator Authority (FINRA). From this perspective, spending $3,000 or even $10,000 to get solid training and mentorship may actually be cheaper over the long run than attempting to day trade all on your own.
The key phrase above is "solid training," which comprises three elements -- foundation, mentoring and support.
The foundation gives you knowledge about the market you wish to day trade as well as strategies to help you extract a profit from the market. While strategies do vary, for the most part this information can be found online or in textbooks for little to no cost. Many day-trading schools even give away their strategies for free. This is because the strategy is only a small part of becoming a successful trader.
Mentoring -- whether by attending regular webinars, having trades critiqued or receiving one-on-one coaching -- is more pivotal to success than just the information a trader receives from books or articles. The mentoring stage introduces an outside, objective observer to your trading.
It is very hard to see our own mistakes, but someone else who knows what to look for can often spot those mistakes immediately, correct us and provide a better way of trading. An analogy is trying to fix your golf swing without the aid of a video camera or a knowledgeable golf professional. Since you can't see what you are doing while you are swinging (trading), you're bound to make the same mistakes over and over again, even while working hard to correct what you think is wrong. Mentoring removes that hurdle, makes the process much more efficient and is likely to result in quicker progress than attempting to fix things on your own.
The foundation and mentoring stages should get you to a comfort point when day trading, and hopefully a profitable position. Support is the ongoing element of the school that is also beneficial. It is very easy to slip into bad habits over time or change our behaviors without realizing it. Ongoing support, and having a school or a group of traders to help you through this time, is a significant advantage. Even professional traders, and athletes as well, have times of poor performance that require a knowledgeable outside source to get them back on track.
When choosing a day-trading school, consider cost, but in the context of what is offered. A day-trading school should offer you a good foundation of information to build on, mentoring to help you understand the information and fully implement it in the market, as well as support via emails, webinars or a chat room where successful traders using the same methods can interact and help each other if required.
Here are three day-trading schools -- focusing on stocks, options, futures and forex -- which offer solid foundations, mentoring and support.
Top Day-Trading Schools - Stocks and Options
One of the largest trading schools is Online Trading Academy (OTA). The academy began as a trading floor in 1997, and by providing daily coaching sessions shifted its focus to help more traders by providing classes, workshops, online courses and free trading resources. Over 150,000 traders are in the OTA community, with live and online classes held around the United States and the world at more than 30 physical teaching centers.
Online Trading Academy offers education in stages. For stock traders, the journey begins with the free Power Trading Workshop where you learn to create a trading plan and implement a rule-based trading system. Next comes the Professional Trading Workshop, parts one and two. Part one is a two-day live course (or four, three-hour online sessions), and part two is a five-day live course (or 10 three-hour online sessions). The courses are priced at $1,995 and $4,995, respectively. Those who take the course can come back and redo it as many times as they like, for life, providing traders with continual support and guidance even after they have completed their training.
In this series of workshops, the core strategies and method are taught. OTA's main focus is on supply-and-demand imbalances; a method that allows for relatively low-risk trades compared to the potential reward.
Traders can further their education with more advanced courses and take courses related to other markets. OTA provides workshops and courses for stock, futures, forex and options traders, as well as wealth-management courses. It also offers a select number of specialty courses, including trading topics such as trading psychology and learning about trading platforms.
Top Day-Trading Schools - Futures
In day trading the futures market, the Day Trading Academy (DTA) offers traders the opportunity to learn to trade in all market conditions. Whether the market is calm or volatile, the DTA method centers on reading price action, so while indicators may be used, they aren't relied upon. The DTA was started in 2011 by Marcello Arrambide, a professional day trader since 2002 and a globe trotter who also founded the popular Wandering Trader web site.
More than 50,000 traders subscribe to the DTA newsletter, which provides free resources and trading advice, and outlines how to gain access to the futures day-trading course. Entering the program starts from $2,997, which includes access to the course and providing what traders need to know about the futures market as well as core day-trading strategies.
Once traders are familiar with the course material they attend live webinars, held during market hours twice a week, to see how the strategies are applied in real-time. This also provides an opportunity to ask questions and interact with professional traders. Daily recaps at the end of the day highlight the trade signals that occurred.
While traders can use the method to trade all day, the DTA focuses primarily on trading near market open, attempting to profit by only trading for a couple hours each day. Traders in the program take screenshots of their trades, send them into support and receive video feedback from a professional trader on how to improve entries and exits, and how to better read the price action to improve decision-making.
Training is provided in an online setting, making it accessible to anyone in the world.
Top Day-Trading Schools - Foreign Exchange (Forex)
The forex market is open 24 hours hour period. A swing trade (lasts more than a day) doesn't have any more restrictions imposed on it than a day trade would. Therefore, schools that focus on forex often day trade and swing trade.
Winner's Edge Trading began in 2009, providing free trade signals, strategies and advice, which it still does today. The Winner's Edge provides its core strategy for free -- to more than 70,000 subscribers -- as well as frequent blog and video posts, which highlight current and upcoming trades using the "Double Trend Trap" strategy.
The strategy can be used in any time frame, although trade signals are primarily traded on the hourly chart in the New York Session Trading Room. Trades typically last about 18 hours, according to Casey Stubbs, the CEO, and there are about 10 trade signals a week. Traders can also adapt the strategy to shorter time frames if desired for more or quicker trades.
Joining the trading room is $197 per month, and promotions are often available for multi-month sign-ups. It gives traders a chance to ask questions and see trades occurring in a live environment, as well as how to manage existing trades.
In 2014 Winner's Edge introduced personal mentoring. The training begins with learning the core method in detail as well as more advanced strategies. Once training is complete, traders are provided with a monitored demo account where a professional trader provides feedback on what is occurring in the account. The philosophy is that traders won't improve by simply absorbing more knowledge. Traders need someone over their shoulder (figuratively) to point out what is being done well and what is being done poorly, and then personal corrective measures are taken. The cost and availability are revealed in a webinar when spots in the program come available.
The Bottom Line
Cost is an important factor when deciding which day-trading school to join, but it isn't the only factor. Dishing out a few thousand dollars up front (or a few hundred monthly) to join a day-trading school may be a good investment if they cut your learning curve and get you on the path to profitability quicker. This is similar to paying university tuition so down the road you can make a better income. What the school gives you should be worth the cost, though. That means getting a solid foundation of information, mentoring from someone knowledgeable and successful in their field, as well as a support network that will help you succeed and stay on track even after your initial training is done.
Disclosure: At the time of writing, the author is not an employee of, nor compensated by, any of the aforementioned day-trading schools.