Are commercial trading mentors sucessful?

I have a theory about this, and am curious to see if I'm right.

I'll delay posting how I expect the results to read, in order not to influence the outcome.

"Mentors" are not profitable in trading; that is why they teach

!00% Right, those who cant teach... its the same in life our schools are full of these fools..

Well we only have three votes so far which is not enough to call a good sample size. Hopefully this thread gains traction and we have something worthwhile to discuss.

So far 6 votes....

Makes me wonder if commercial mentors really do make that much money :-)

I could never understand why, if you're making the fortunes that some of these people claim to be making, you'd want to sell training and subscriptions to websites etc. Why not just trade? I can understand writing a book about something you're interested in for other people, but once you've done that, well that's it. If I was rich from trading, I'd keep myself to myself. But that's just me. Takes all sorts I suppose. Good trading to everyone.

Quite correct and it is these kind of topics I want to discuss more in detail, once I have a bigger sample on the polls.

Thanks.

I'm very interested to hear people's stories. But of course, as always, you'll never know who's telling the truth and who isn't..........

I think you're actually asking the wrong question.

There are plenty of mentors out there who may have only a basic knowledge of any field, but none the less are paid to advise people on success. If anyone's ever had a corporate workshop they'll know what i mean.
Plenty of motivational speakers out there like Tony Robbins and Brian Tracy have made millions mentoring people, yet have no specific experience in the fields of every person they've taught.

From what I gather, the testimonials given by clients of any mentors are usually based on a mentality shift, rather than a specific insight into their own profession.

I think Forex mentors are in the same boat. They need only have a basic knowledge of the freely available information on trading, need to be as non specific as possible with advising on a system, spouting the usual staples of candle patterns etc and they can pass themselves off as a mentor.
After all, what they're telling you may not be wrong..but is it useful? And does the word mentor actually imply that he/she is a practicing professional in that field?

For this reason, i think asking if you are profitable after paying a mentor is not representative of the value of the mentor.
The mentor may not have given you a specific strategy. Many mentors claim their success is in the success of their students having taken the lessons learned on board and built successful systems...that's a very different thing! In this regard, a mentor is just a person who consolidates what they believe to be the relevant information on the forex market into lesson form for you for a price.

I think a better question would be:
If you paid a mentor, did he provide you with a strategy of his own design, and was that strategy profitable?

Take a look at the most successful systems threads on this forum, commercial especially, but even the non commercial. There are guys being hero worshiped for sharing wonderful systems...so many disciples proudly uploading screenshots of their successful trades.
But...how many successful, profitable TE's or myfxbook trackers can you see for any of the systems here? Sonic, 00, PVSRA, SMRI...to name a few. So many posts, and so many happy people...not one shred of evidence other than handpicked screenshots to show if it is actually working for anyone!
Sure, with non commercials I don't care, but the commercial threads are littered with methods sold by people with either a demo TE lasting 2 months, or no TE at all!
I will never understand those who pay for something that has no evidence of effectiveness.

In general, I am a little torn on whether a successful trader would bother teaching. The Greg Seckers, Niall Fullers and countless other guys are marketing specialists..not traders. They "teach" but have no evidence that they can actually trade. Sadly they make a lot of money doing it, with none of the stress of trading!

To me, there is more money in managing money for others than there is in selling courses; if you are a successful trader. But that too can have costs, such as financial licenses etc. Still, for a real trader with a track record, this would be a more constant and lucrative form of income. There are very few examples of such people in the public sphere!

I don't think all mentors are useless...but for my mind I would never pay a person to teach me to trade, unless I could see evidence of his current and successful trading, with a long steady history. The same way a person cannot learn to drive an F1 car, from someone who only knows about them from books.
But if someone wants to pay another to compile forex education materials for them, it's up to them. That to me is outsourcing work, which will inevitably rob you of the chance to see the whole picture, but it's personal choice.

No.End of thread,no need to discuss any further.

This is very very true. The only mentor you need in this business is the market, and to remember that doing the same thing over expecting different results is insanity. Who would you trust more?

Yourself.

Or a person who is there just because he wants your money.

I know which of those options I'd choose, do you?

Hi Trader34,

Thank you for a very inspiring post. Perhaps you are correct in your own choice of title however, I wanted to use something short with the aim of attracting more people into vote.

With regard to the quote above at the start of this post I would consider the following. Anyone who has spent a sufficient amount of time in the markets "know" that this is a tough task. Also if I were to sell a strategy to students the price would be far greater than anything that is currently offered in the commercial section.

Lets discuss this idea a little further. Since the rise of Algos the majority of structural edges or lottery tickets as a colleague of mine calls them have disappeared. Even if you were to find something it would be just a matter of time until other participants discovered it and the liquidity would dry up or the exchange would be calling you with a warning.

Even higher time frame strategies will eventually run into trouble - take the Turtles system. This used to be profitable until books were written about it along with various trading magazine articles etc. In Ed Thorps "Beat the Market" he was able to calculate quite accurately the "Edge Decay" once the details of his system were released.

If you think from the perspective that, a mentors profits are achieved through selling his system to as many people as possible, well does this not defeat the object? Being that a mentor should be there to help new traders, yet in fact by continuing his business plan he is in fact contributing to the edge decay that will inevitably ruin his system?

I do understand what your saying about other famous mentors like like Tony Robbins and Brian Tracy however, I have not seen any trading promoters here saying that they are teaching life skills not trading skills.

Actually I agree with you there, and it's why I have a pet hate with the commercial section of this forum.
Even if the mentors aren't directly selling a system, then they are claiming to be able to impart knowledge that will make a trader profitable.

The problem is, from what I've seen from clients, these mentors only seem to have gone to somewhere like babypips and copy pasted/ re worded information on the stock standard concepts of Forex trading: price patterns, indicators etc. Occasionally some go deeper ( copy paste from investopedia ) and give some insight into market structure, broker operation and so forth.
My problem with any of this is, there has been nothing I've seen so far from a mentor that is not freely available if you actually bother to do some decent research. For this reason, i can't totally blame the mentor. In his mind I'm sure he justifies his charging people in the work done to compile the information. If people choose not to research this stuff themselves, and expect someone to spoon feed them, then I can't blame the feeder.

However, selling trading strategies is a different matter. Yet every day, people are paying others for recycled garbage that comes with no proof of efficacy. Sadly forums like this allow it.

Let's be honest...there's nothing original here....there's no revolutionary new indicator that's not based on a flawed one that's existed for years. There's no magic setting that will turn a simple MACD into a money making machine. There's no one out there who has the ability to see where the big boys are placing their orders.
But, there is an industry built on people claiming to have one or more of the above skills...and that industry makes more money than actual trading for the most part.
It's a shame, but it's the truth.

So, in line with your comments on strategies in general; first I would never bother trying to sell a strategy. First, I'm not a people person, and frankly I can't deal with stupid questions. Some people will not like it (that's fine) some will just not get it, and the rest will just not stick to the rules. Some people can't be helped, and (perhaps this is what you were alluding to) if i had to spend more than an hour or so teaching someone how to use my systems, I would charge them hugely!
Time is the most precious commodity to me.

Now, in regards to "Edge decay" i tend to agree with that being a real phenomenon. However, I'm not sure I agree with your reasoning.
I may be wrong in my interpretation of what you said, so I'll outline:


Ok, if you're implying that once you have a profitable system, market efficiency will take over and remove your edge, then I disagree strongly. In fact, many of the commercial con artists here have used this as an excuse, saying their methods can only be sold to a select few so as not to alert the markets to their secret winning ways! Then when it breaks down they say "sorry guys, they found out about us!"
It's just [email protected]#it!

This comes down to market structure.
We as retailers are insignificant, particularly at individual account level. I've been through this in detail in other threads so I don't want to go on for pages here, but just because a retail trader is winning, the LP's won't close you down, or start removing your edge. We don't even come on the radar here.
This is not the reason an edge decays. Our orders aren't big enough to be worth taking out!

Edge decay occurs due to the fact that the market operates mostly as a random walk, with pockets of non random movements which provide chances to make money.

Edge decay usually occurs when a person testing a method uses conditional bias in developing their system.
So, in a trending period we see countless new commercial methods pop up showing great trend following methods.
Then the market returns to range and they all disappear, and out come the range bound systems.
The problem is, depending on the timeframe/pair combo, these can be simultaneous so there's a never ending barrage of people spruiking their methods, claiming they have the best way.

Of course, when the market changes again, they're dead in the water.
This issue is compounded when a seller uses specific indicator settings in their methods, because those settings will be tuned for a specific condition.

So, in my view a mentor selling his conditionally biased method doesn't contribute to edge decay.
What it does do, is create a false perspective of how to trade markets.

Think of this example:
A guy signs up to a mentor, learns his wonderful trend trading method and starts trading it. In a few months (or years, some "mentors" are clever and only use daily charts, because by the time the student realizes it doesn't work, he has already paid out a lot of money!) he sees it's not working and begins searching for the next system that doesn't need a trending market. He signs up, pays his way and begins trading, only to once again be using a method that was set up for the conditions that led to the previous breakdown...once the market begins to trend again...he is back to square one.

You see this all the time. People assign magical numbers to predict where the price is going next.
Oh, the fibo x is being re tested so the price must go to fibo y.
There is a MACD divergence so the trend must be changing.
The RSI is overbought so the price must go down.

Almost every method sold is built on this type of thing.
This is not how the market works!

We as retailers are "off track" betting on transactions made at interbank level. If they have to put a yard short on EU, they will do so regardless of what fibo line is being touched.
The only people who care about these things are retail traders who mostly lose money.
Mentors/ sellers capitalize on this ignorance.

To me, mentors who sell methods are vultures. their plan is to get in, get as much meat as they can and get out when the lions come! They know very well what they have has a limited lifespan, so they try to milk it for as much as possible.
Later they reappear in a new form, and sadly there are more willing suckers to buy into their crap.

In my view the only solution is proof.
No member on any forum should be allowed to sell a system without 1 years live profitable results.
If this was true, the commercial section of this site would disappear overnight!

Yes your right, I should have been more clearer with this. This is heavily dependent on the type of edge we are discussing. As I am sure you are aware some edges are more sensitive to liquidity than others. Also as you mention a big part of this is due to systems being created that do not take into account for regime change. Indeed there are very few threads discussing "stationarity tests".

On another note there seems to be a new stream of strategies being posted that attempt to trade a market based on order anticipation. Whilst these concepts may be sound from a theoretical standpoint a real market is far to dynamic for trading like this. Also bear in mind that the majority of fx broker use internal hedging for orders and so very few retail orders will actually make it to the real market.

If by real market you mean the interbank market, then none of our orders ever get there. Ever.
Again, this has been done in other threads, but in summary...despite what the brokers tell you, they are not participants in the interbank market.
They are customers of market makers, nothing more.

The reason they are allowed to claim market participation, is because they invariably use pools of LP's that are market makers.
But, that doesn't mean the order you place is helping Deutsche put their 3 yards into the real market. They do that between each other and via interdealer brokers. This has nothing to do with retail Fx.

The market maker participation in LP's is basically a sideline moneymaker between them, the aggregators and the brokers who all in turn profit from our placing of orders. Brokers make from commissions, Aggregators make from the bridge software licensing, and the LP's make from decent spreads.
Well, that's the ideal model.

As you stated, the truth is, most if not all orders are squared at broker level first. I'm sure you've heard of A and B booking, but that really only skims the surface.
Closely look at the small print of ANY retail broker, and it will clearly state that as soon as you place an order, the broker is in contract with you for it. The broker will decide which if any orders go to the LP's, and if they do, the broker has already marked up spread to buffer and price jumps between the time it took to accept your order, and the order being placed at LP level. That's one of the reasons spreads are so high during news, when the price moves so quickly, the broker needs to cover their position.

Having said all this, a retail broker is not necessarily against you, or losing when you win. Their business model can tolerate winners, particularly if they have high volumes, because they get more favorable pricing from LP's and they have better lines of credit. And as you say, even MM brokers have the ability to hedge your trades, so it doesn't hurt them if you win.

The broker doesn't make traders lose. Sometimes they can profit more form losing traders, but traders lose all by themselves!


Are you talking about order flow/market depth trading here?
Where traders either try to use charts to analyse, or the brokers COT data to decide where the areas of order density are?

If so then yes, this is another flawed concept.
Market sentiment from brokers like Oanda, FXCM etc only tells you the orders on their books. Myfxbook has a "community outlook" tab where they list the biases of orders on their trackers...But who cares?
Where us retail minnows have our orders means absolutely nothing.
A few people are trying to base their strategies around this, but it's a false premise. This isn't an edge.

In my opinion...edge is only found in parameters.
We really only have 2 options: but or sell.
How we decide to enter, how much we expect to take, and how much we are willing to lose will dictate what, if any edge we have. This is another reason the gurus fail to produce longterm profitable traders.

Take a pair like EURAUD.
If someone had designed a system trading that in the middle of last year, they would have based their distances on the pair having an ADR of around 160-200 pips.
At the end of the year, and the start of this one...that same system would likely have created many losers because increased volatility caused ADR's to hit almost 300. So, even if you were picking signals the same way, there would have been a good chance that the increased movements would have caused those entries to have been spiked out in what would normally be survivable retrecements.

It's a loose example I know, but what I'm saying is, the only way to keep any edge over markets is to adapt as they do.
When things change, we have to recognize it, and the potential impact on our trading before it causes heavy DD's.

The mistake people make is not seeing the change coming, then not acting fast enough. They then either curve fit their method to the new conditions (meaning when things change again the method is void), or drop the method totally and go looking for one "better suited."

The pattern repeats over and over until either they give up, or wise up!
Most do the former.

Could not agree more.

I always frown when I hear people on FF passing judgments on the market such as "we will go down today because of x" or "if we break this level we will tag y".

In my opinion you should try your hardest to refrain from passing judgments on the market. Instead you should be listening to the market. The market can tell you a lot of information when you know how to listen...

Mentors make a living telling people they have the formula to predict.
I've said many times that; if there was any method at all that worked all of the time, there would be no need for mentors, or forums such as this.
We'd all just be doing it.

Still won't stop some poor sucker buying the latest "super mega quantum paradox power EA" tomorrow!

I haven't ever met a successful mentor.

You're right redbaron1981.

Only listen to the market.
Who gives a s*** about charts?
I got rid of all:

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