Teaching a teenager to trade

[marketsurfer]

hi,

does your son have a natural interest in the markets ?? OR does he just want to be like dad ?? this is a critical distinction.


best to you,

surfer

 

[Yannis]

Quote from OffShoreTrader:

Has no business learning how trade. Unless you yourself are adept at the psychological adversities that a trader predisposes herself too, how to handle it, how to detach yourself, and how to apply the rigouroous emotional ups and downs to life in general, then I don't think anyone should be teaching a kid to dance with the market.

The repercussions, the negative emotions are such that a 14 year old child doesnt even know whe he is yet. How is this child going to know what emotions he faces, how to identify then, and act correspondingly.

A child who is less than complete, and most adults are not even a complete person, may end up dealing in a very negative way, the feelings of loss, inaptitude, failure, dichotomies, and myths.

Good luck, my advice, don't even think about it.

OffShore,

I understand what you are saying, and my wife (PhD Psychology) had some similar concerns, but I don't think there's any danger here. He'll take it easy and learn something about himself and his environment from a safe perspective.

I remember a few years ago, when I took my then 6 year old daughter to start her Tae Kwon Do lessons (my son had already gotten a green belt at the time.) Several friends advised us against it, stating that fighting will scare her, make her aggressive, etc.

Instead, she took to it like a duck to water, because she never saw eastern martial arts as aggressive, but as an honest way of living - coupling respect to others and self discipline. Now she has a black belt and is working on the second degree of that rank (which my son already has.)

What's more, she does not perceive TKD as fighting or even aggressive. It is very natural to her, like Greek dancing and ballet (which she also practices.)

What I'm trying to say is that perhaps the negative emotions that many adults face when they start to trade may be due in part to the fact that they have not had the chance to see the market as a paradigm of life, as a means to self-improvement, how one can live honestly by taking responsibility of each of their actions, how one can deal with it in an impartial and healthy and open way.

Make sense?

 

[Yannis]

Quote from marketsurfer:

hi,

does your son have a natural interest in the markets ?? OR does he just want to be like dad ?? this is a critical distinction.


best to you,

surfer

Thanks MS,

Yes, he does. He actually led the team that got first prize in the investment game that their social studies teacher put together this past year. He's read a couple of market books, like "Investing for teenagers" and the famous O'Neil book (although I can't think of its title right now ) where he introduces his CANSLIM method.

He appears genuinely interested, but of course, the dad aspect is playing a bg role too.

 

[marketsurfer]

Quote from jack hershey:



After 11 is a good age.

You can either use a discovery process or if you are successful you can just mentor using your method.

Sixth formers are perfectly capable of running their own accounts.

One phenomena of learning to trade in a formal educational setting is that the students and their parents have a total Renaissance in their relationship.

I got into this by accident in Greenwich Conn; I was running an evening course for parents (a la Kemeny) to retool their mathematical decision making basis. They recommended it be taught to sixth formers. I started this and always had one or more families finance their child's efforts. It became well known that a student was capable of financing their own education.

This was in the early 60's.

Since I had the luxury of doing what I wanted it went this way:

Ancient systems of numeration (To find out what limited the civilizations mathematically and learn to do maths research)

Running a families finances (we simulated wealthy families such as theirs completely)

Investment (We used 7 keys to value (NYSE) and developed 17 indicators for analyzing annual reports- each student harvested facts from 10 corps ) Standard and Poors gave us a full blown brokerage firm service support- we had an add and delete done daily on all publications they overnighted)

TA All students hand charted daily their 10 corps we used 4 th Ed of Magee as basis.

They did investing and short term trading continually through the year and we filed in March the 1040 with all schedules. This fit into their family finances.

We always went to NYSE on 29 OCT and once I had a B'day in class so I had the floor sing happy birthday. It was before glassed in balcony. We had lunch at Lehman.

What was the most important was how the students pooled their knowledge and connected it to the daily news in their suscriptions to the WSJ. We did back plotting of any stocks they wanted to add and one wall of the classroom was shelved so that for each stock on their lists there were ten copies of annual reports for several years and the interims.

I was retired after grad school and completing five years of employment. My focus was making 10 to 20% a month in equities so I served as an example to the students. In those days the market did not demand anything close to watching it real time. The daily data was in vogue and there ws no formal commercial charting available. We did it all by hand. The formations and P. V relationship were the primary thing they chose to succeed. The 17 measures they made on annual reports also ran along as important filters for getting a focus.

If you are nailing 10 to 20% a month it will be fun for you and your sone. If you are doing commodities etc, my guess is that the relative increase in ROI over equities will be the major attraction.

I was working in a setting of wealth and noblese oblige so there was and understanding that success was an obligation. Money for run of the mill people can take on a religious orientation if you are not careful. This is best done in a context of understanding wealth is all part of life and maintaining it is not a difficult routine from generation to generation. With it comes the responsibility to be integral in the responsibilities and fabric of society.


It is very true that students who are in this orientation then go to higher education to learn to contribute through their life choices.

jack,

your posts are fascinating. you have a wealth of knowledge and i appreciate you sharing it.

thanks !

surfer

 

[jack hershey]

Quote from Yannis:



Snip....

What I'm trying to say is that perhaps the negative emotions that many adults face when they start to trade may be due in part to the fact that they have not had the chance to see the market as a paradigm of life, as a means to self-improvement, how one can live honestly by taking responsibility of each of their actions, how one can deal with it in an impartial and healthy and open way.

Make sense?

Good observation. Most of these nay sayers should read Rich Dad, Poor Dad to get an adult orientation to replace their Poor Dad childhoods.

Let your wife comment on their posts for laughs.

 

[Trane]

Yannis,

Do not pay attention to the posters that are saying you are insane. I was exposed to trading/investing at the age of 12. Bought my first stock at the age of 13 (before HS) and by the time I had graduated I turned my measly stake into a more than decent sum (with the help of a rich uncle and a raging bull in 95 -- born on 3rd base and thought I hit a tripple) and was able to do this for a living coming straight out of highschool...

I think now is the perfect time for your son to learn the game, his 'cup is not too full' and has probably not yet been tainted. His mind is like an indiscriminate 'sponge' at this age...

He will learn discipline, patience, loss, humility, etc.
ahhh no better arena to shape a young man IMO...

I don't know if I would start him off learning to trade in and out during the day, but maybe the swing side (days to weeks)...

Good luck to you and your son!

PEACE

 

[marketsurfer]

Quote from Yannis:



Thanks S,

Yes, he does. He actually led the team that got first prize in the investment game that their social studies teacher put together this past year. He's read a couple of market books, like "Investing for teenagers" and the famous O'Neil book (although I can't think of its title right now ) where he introduces his CANSLIM method.

He appears genuinely interested, but of course, the dad aspect is playing a bg role too.

that is fantastic ! i wish i had someone teach me when i showed an interest at 14. best wishes to him on his journey !

surfer

 

[OffShoreTrader]

If the father or mother believes they truly know what the adverse affects of trading can be, and can guide their child through those emotions, they yes, go for it.

But consider that less than 10% of all people make money. That in essence means, 10% know how to deal with the market psychologically. Unless you show a profit, unless you have a multitude of experience in the market, then show the kid how to trade, teach him the emotions of trading.

But, the last thing a kid needs to learn at age 14 is how to make money through the market. Self discipline, respect, honesty, integrity, stamina, and other qualities can be learned elsewhere where there is not as much negative affect on their lives.

What happens if this kid makes money? What happens if this kid makes a ton of money by age 18. He loses all respect for the value of money, the value of HARD WORK. You can't possibly tell me this kid will know what HARD WORK is. He will treat it as a hobby and if he does delve into the market as a passion, then he singles himself out of the rest of his peer group.

He will then spend more time alone analyzing markets, reading books, much like traders do. And this brings problems in and of itself.

Many "wizards" state they picked up trading at a young age. They were drawn to it, but if the kid shows no magnetism to trading, I really say, let him deal with it a later age, when he is more emotionally mature.

We musnt forget that trading is 90% psychological after methodology is learned. No way a 14 year old has the thought process or emotional stability to handle the adversity of trading.

SImply, the person teaching their child has to make an HONEST, VERY HONEST ASSESMENT OF THEMSELVES. Do they understand the market pscyhologically? Do they understand the ramifications of making money by clicking buttons? Do they make money?

If they believe they can teach a child the market when themself does not make money, oh my. It's like teaching a kid how to swing a golf club when your a 30 handicap.

Good luck.

 

[Yannis]

Quote from jack hershey:



After 11 is a good age.

Jack,

Thanks for your suggestions - I have a similar viewpoint.

My dream is that he get to understand a very good field, rich in interesting concepts and clearly influential in his life.

Also, that he get a peek into the issue of the fear/greed demons we all have to struggle against.

With some luck, if he sticks with it, he may also acquire a valuable skill that could help him a lot in his life, whatever his chosen career may turn out to be.

 

[Yannis]

Quote from Trane:

Yannis,

Do not pay attention to the posters that are saying you are insane. I was exposed to trading/investing at the age of 12...

Trane,

Thanks - I appreciate your encouragement.