I have come to see that trading is the skill we need going forward into the 21st century …

Let me start off that like some of you I am either just starting or reigniting the trading journey. As I have noted in previous posts, humans engage each other for the purpose of exchanging value. We expect to walk away from that trade with some benefit that is greater than the one we gave up. We trade expectations.

We need to accumulate particular skills in order to optimize our exchange of benefits. Expanding our skill sets may include learning how to read a contract to ensure that our expectations are documented in writing and to understand our rights where there is a breach.

We may need to increase our understanding of the regulatory environment surrounding our exchange. For example, what information is a broker required to disclose with the trader? What fees or rates is a bank allowed to pass on to a trader? Can a particular asset be bought or sold on or off exchange?

What is the difference between fundamental analysis and technical analysis? What is an exchange rate and how is it calculated? What the hell is a central bank? Hell, why do we need one?

With all the talk about artificial intelligence, most of us are becoming as self-aware as ‘HAL’ from the classic movie and book, “2001: A Space Odyssey.” While I don’t see some aspects of gloom and doom coming to fruition, as the father of a 21-year-old college student, I do ponder what will be his next income making moves.

Fear not. I am not a helicopter parent (at least I try not to be), but watching the structural changes in our economy, like any parent, I want to see him go beyond his dad and grand dad and thrive.

If he or any other young person on this globe were to ask me for any insights, I would combine my adage, humans engage only for the exchange of value, with the following: all exchange is about information. Learn how to vet information.

You may say, “Well damn, Alton, that is common sense” and I would agree with you. The problem is that information has been further commoditized by all the apps and media floating on the internet.

YouTube, for example, has gurus galore. Half the brats I see on the medium touting every scheme in the book seem even younger than my son, yet people are consuming a significant amount of their unvetted content.

The deluge of information makes it harder for we old heads to process info much less younger minds who are, unfortunately, not the greatest of critical thinkers. This need to vet leads to the second piece of insight: seek out platforms that can help you get to clarity.

For example, when we trade foreign currencies we are trading information about the economies and politics that underly the currencies. The dollar, in my opinion, is a derivative, a representation of the value of an underlying platform we call the United States. Whether you engage a group of brokers associated with an exchange platform such as NADEX in the U.S. that platform should provide the transparency required by registration, tools, and access to information that optimizes your trading by optimizing your ability to vet information.

Information and trade are global. We should focus on independently converting what capital we have into life sustaining income. We should learn to apply these tools on our own and learn about the platforms on which we can trade.

Alton Drew

8 September 2023

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