I am planning to start teaching my son, who is now 5, how to trade. I am a pure price action trader trading intraday mainly. So far, the only trading knowledge and exposure my son has is the following: - what bulls and bears are (green/red candles, ppl who buy/sell etc) - direction and price movement that bulls and bears produce - a little play with fibonaccis, trend line drawing, pitchforks etc. He does not have much of an understanding of these tools, besides trend line drawing. He knows how to connect the swing highs/lows, draw channels, wedges and triangles. I have previously helped a couple of people with their trading, but they have been adults in their 30s/40s. My question is how should I go about teaching/exposing a 5 year old to trading (more like chart reading)?. Should I do it like I did previously?. The only issue I have is that he may not understand some of the concepts. In this case, should I persist, or is there a better way to teach non-adults. Your advice and insight is much appreciated. Thanks in advance.
I don't think it is to early, but you just have to go at the speed of what he seems interested in -- don't be pushy. Each child is different, watch what lights him up. Part of teaching him might be sharing with him what puts a light in your eyes about trading!
He's 5 years old and that's the ONLY trading knowledge he has? LOL! I think he beats most adults by now. Made me chuckle.
Interesting question. Can a 5 year old learn about direction, support and resistance, trend lines and breaks...if he/she is bright, yes. But trading charts requires understanding human behavior as well (IMO) and that requires a maturity beyond the majority of 5 year olds. But I expect the question is can the child begin to learn and not begin to trade.
Thank you @speedo I am going to try to teach him the best way I know. I want this to be more like a game for him at the moment. For instance, we will be calling profit, points and consolidation, a box etc. I'll take it from there and see how it goes. Truth be told, this is experimentive for me and I only indulge as I usually see him playing with charts when he could be playing some more "entertaining" video games.
The only concept I think could possibly be confusing for him is that he can follow all the rules, and do all the right things, and still lose. I'm not sure if that would be helpful or harmful at that age.
I think 5 year old too young, I rather be with him at park going down the slide or swings, play Frisbee. I started mine at 12, and we did it in a fun way and not behind a screen. I taught in a physical way of support and resistance, again going to the park and it gives you an expressive idea of how to take charts and what you want to teach him by physically doing it. Monkey bars are support and resistance, and angles, the swings show price can only go up so far, so when you do start him on screen, he will recall the time two of you spent at the park and what he learned there. At sixteen he did very well trading T-Bonds during the summer but found it boring cause he didn't have to go through the pains of not having to dig it out himself. He is his 30s now and he is learning a much tougher way from me now, I want him to feel the pain of digging it out, I am not going to give him systems, but show him direction, but he has huge edge, he is very good at programming Tradestation as he learned how back in the 90s and I owned it back then till TS discontinued those owning it. Just think it easier for kids to learn by doing as too young they can't understand concepts.
Atleast he's lucky to be starting early. Plenty of time to learn from ones mistakes and come up with their own unique style. Once you're old enough and stuck in the rat race, learning and getting good at something else other than your job gets infinitely harder. Just one thing though. Everyone has a different attitude to risk. If your son ever starts to have a string of unbroken wins, it could lead to overconfidence and hence more risky behavior... I trust you know what you are doing though.
Bad...very bad...don't do it. In contrast, its ok to teach about the markets and the stuff you mention but not ok to teach how to trade. Simply, teaching someone how to connect swing highs/lows is very different than teaching someone how to trade. The latter involves a psychological elements not suitable for a 5 year old. There are actually studies involving teach kids simple physical tasks versus complex physical tasks versus complex intellectual tasks versus simple intellectual tasks. I'll give you the information when I find the research...I first saw it on TV in a documentary involving how children minds work when learning new tasks and the psychological impact even under the facade of fun. Simply, just stick with definitions, names, how to draw trendlines...make it a game. Yet, no teaching how to trade. Just remember kids are like sponges. What that means is that you really don't need to make much of an effort to "teach". Just them being around you every day and you giving quick explanations or they hear you talk about it or watching TV or turn it into some kind'uv adventureous bed time story...that's enough. They'll get it. There are some children books about the markets in general...look around for them. They are out there.