Can't I Just Copy Someone Else's Trades And Investments?
"Give a man a fish and he will eat for a day. Teach him how to fish and he will eat for a lifetime."
That's a very universally applicable quote, and it definitely applies to investing and trading.
With technology becoming better and better, many untrained investors have started to use software platforms to copy the trades of gurus that they follow and like.
While the appeal of this certainly makes sense, there are a number of risks that most people do not consider before blindly copying others:
- Copying others assumes that your risk profile and financial situation is exactly the same as theirs, which is fundamentally flawed. To highlight this with an example, a person just starting out with a net worth of $100,000 should not be taking the same risk as a guru who is worth $5 million — the guru can spare putting 1% of that $5 million into a speculative investment (i.e. $50,000), lose it and barely feel it. But for the person just starting out, $50,000 is half their life savings.
- You become heavily reliant on the guru sharing you information about their activity. In other words, if they ever disappear, you're stuck on what you need to do next. On the other hand, if you've developed the lifestime skill of investing and trading safely, you'll feel financially secure no matter where you are and what your financial position is, because you will know what to do as soon as you have more money coming in. An example of this is weathering through short-term losses to gain wins in the long-term – it's a process that can take a huge toll on you emotionally, and you may end up selling out early because you don't understand that's just part of the guru's strategy.
- You don't know when the guru has actually bought and sold their trading positions (in terms of timing) — in the end, you're relying on the assumption that the communication of information to you about their activities is real-time and immediate. In the case that this information isn't immediately conveyed as soon as it happens, you could very well be buying or selling at the wrong time (because by the time you've received the information taken action, the market has shifted, and the window of opportunity has actually passed).
- Many of these 'gurus' that send out timely SMS trading activity updates to buy / sell certain stocks only do so because they are affiliated with brokers, and they can profit from you making those trades — regardless of whether you profit or not. Usually, a telltale sign is when the 'guru' tries to get you to stick to using a specific broker.
Like anything else, investing and trading in stocks is a learnable lifetime skill that you can pass down to future generations (i.e. your children). If you desire to have true freedom and financial control over your destiny, it only makes sense to become well-versed in it.
Check out what our students have had to say below!
"I guess with Terry's system, what's so great about it is not only is it – he really is teaching you how to fish as opposed to just handing you fish that you're so reliant on – but he's also quite engaged with the community and it's a bit rare to see a course that has that support in their own community."
— Duy Phan (Construction Manager)
"I can give money to fund manager and ask them to manage my money, but that’s going to be short-term. Long-term is the skills that we possess ourselves. So we are learning, So what Terry is teaching is ‘How to do it’ – that means you area learning, you are active, you are going through the process and the system whereas with others you’re just going to give them the money, invest it and you’re not learning anything there."
— Rajesh Mudlapar (Principal Engineer)
"I think patience is one of the key things that numbers just don't teach you, I think, I mean you can have a look at the numbers all you like sometimes when you've got your money down on the line, you tend to get pretty emotional about these things. But it's about being patient at times and just sticking with the system. "
— Martin Wong (Systems Analyst & Modeler)
"Just the way he teaches like, he teaches you how to manage risk, do the fundamentals of research – didn’t find it that difficult we both did it and then we found we got the independence to do it ourselves and we have control, we weren’t relying on advisors and brokers and everything. And Terry gives you direction but it’s ultimately you that makes that decision, it’s you who pushes that button."
— Jerry & Valerie Kidd (Boiler Maker & Bookkeeper)