Trading and African youth: The bitter truth
Trading can cause more harm than good to African youth if they are not sensitized quickly. Trading in Africa is becoming more and more important especially on social networks thanks to the announcements of so-called experts and trainers brandishing external signs of wealth so the goal is to make people dream and sell their product as much as possible. In Africa, more specifically in French-speaking Africa, we do not have an education that predisposes us to fully understand what online trading is and what it can actually do for us.
Trading, especially the speculative branch, is a risky activity that is not suitable for all types of investor.
If we, Salix Nigra, decided to train Africans in trading, it was first and foremost to educate Africans about the real nature of trading and how to profit from it.
The young African believes that with trading he will make millions from scratch or with very little investment. Well, that's wrong. It is not for nothing that a lack of necessary capital is a cause of failure for new traders. Many pseudo young trading trainers tell how thanks to trading they quit their jobs. Thanks to trading they pay all their bills… I'm kidding. We always say it, Salix Nigra has been around since 2016 and with the same name. Many change their names, many promise to make you rich by trading with 5 Dollars. We even did an article (Can you trade with 5$) to raise awareness about this phenomenon.
The young African thinks that by following a few videos on Youtube and learning some trading strategies, he will be successful. Search for trading on Google, you will see over 2 billion results. Strategies and concepts of all kinds exist there. Unless you are born geniuses, you will not be successful in trading without the guidance and supervision of a pro, a coach, a professional who takes care of you and shows you how to put your knowledge to practical use. Driving lessons are available on Youtube; but how many people do you know who drive after seeing these online courses?
Trading is above all about investing. To properly establish your knowledge, you need to have a minimum investment capital. You cannot pretend to start a business without having a minimum of capital. At the base, trading was an activity reserved for the rich, the bourgeois class. This element of trading still endures by the nature of the business which is outright investing. Do you want to learn how to trade and become an investor with 0 CFA francs in your pocket? SORRY!!! It's not possible. You will never have mastered the psychological aspect which is the number one cause of failure for a new trader.
The wrong way to use demo accounts. Many new traders firmly believe that by using demo accounts they learn how to trade. Big lol! This is the biggest illusion in the world of trading. Demo accounts with virtual money, before being democratized today, were reserved for experienced traders; weird isn't it? I have been trading since 2007 which is 13 years now, and when I was starting out I did not have access to the demo account. Brokers only gave demo account access to those who had real accounts and were already trading. With some brokers, you had to apply and wait. I will explain the usefulness of the demo account in another article.
Young people love, seek out advanced concepts and theories that are of little use to them for a start. I like to read the exchanges between our customer service and the various young people who contact us. Just recently, as part of the selection of candidates for our next training session in August 2020, an interested party wanted to have the detailed program of our training. He was told that this is only given to the selected candidates and however we have given him an overall summary of what will be taught. He said he already knew a lot about trading and wanted to know if we could teach him what he doesn't already know. Here is exactly what the young man said:
“But the insidious notions you speak of make me laugh a little softly.
I suppose you are not dealing with a subject like the order book, foot-print, profile volume, VWAP, zone hegde, iceberg orders or even the cumulative delta.
I saw you are based on cfd surely on mt4 • 5, and therefore, that you do not intervene in the fdes futures market. ”
I have to admit I had a good laugh after reading this. For those who do not understand what he is saying (as by the way our agent who exchanged with him), imagine you are going to learn driving in a driving school and want us to teach you car drifting
Or the stunt driving
Yet you do not even know how to practice simple conduct. Seriously…
This young man (like many others) is focused on super complex concepts set up for financial assets he cannot afford and to run on systems he has no idea of. He's probably seen a tutorial or two online from an expert who touted strategies based on these tools, or he just thought it looked pretty. I officially challenge this young man to contact us with his transaction history (same demo) where he put these concepts into practice. If he has an ROI equal to or greater than 10% and a controlled drawdown of 25% max over the past 10 months, we will give him a trading account of at least 1 million CFA francs.
To young Africans, Salix Nigra teaches simple concepts and strategies, necessary and above all adapted to your profile. Like driving, trading is learned gradually and according to the objectives of each one, there are some who prefer to drive simply and those who want to “drift” or “stunter” can specialize but first you must already drive alone without go into the background. What matters is making a profit even if you are using a simple moving average strategy.
Finally, the young African wants to know how much he will make after his training (which is legitimate). The answer we give to this question is "we don't know". This has the effect of discouraging many. It's on purpose. Dear young people, I in turn would like to ask you a question. Can the principal or head of School you attend tell you what your exam average will be? What you would be able to do as ROI after your training is strictly up to you and your performance. No one serious on this earth will tell you. Even I don't know what I will do this month as ROI. But I do know one thing, I will make a profit at the end of the year.
Ignorance of what it is to trade and how to be trader is the main problem facing young Africans. Another problem is the illusion of how easy it is to make a profit. Until trading is taught and promoted in all honesty, the number of frustration will grow and the discipline of trading will be seen as a scam and not as an invaluable opportunity for African youth.