My opinion is that some sports trading marketers in the horse racing space are marketing their products irresponsibly and are sending traders down a blind alley.
I believe that they have been doing this for years. I believe that their advice is marketing and not teaching. I believe that their “teaching” sends aspiring traders away from the knowledge that they require to have any hope of success in pre-race trading.
I also believe that their “teaching” sends people towards unproven methods that are unlikely to work. Why would they do this? They may have a conflict of interest. They may get more sales when they do this.
Above is a video where I explain Sports Trading’s Ugly Secret. You will find a transcript of the video without images below the video.
A. Transcript of Sports Trading’s Ugly Secret
1. Looking for the Key in the Wrong Place
So, I will start by telling you a story from Sufi literature. There are many variations of this story, which all have the same meaning.
Nasruddin was on his hands and knees searching under a streetlamp.
His friend saw him and asked, “What are you looking for?”
“My key,” Nasruddin replied.
They both looked for the keys, and after a while, the friend asked, “Are you sure you lost them around here?”
Nasruddin replied, “No, I lost them a few blocks away. But the light is better here.”
I’m using this story as an analogy. The keys represent your potential success at trading on horse racing. If you are looking in the wrong place, you are unlikely to have success.
2. The Businessman’s Conflict of Interest
Why might you end up looking in the wrong place? What if a businessman points you in the wrong direction? A businessman can send you to the potential key to success or down a rabbit hole where you will just end up confused.
The businessman’s problem is that he makes more money when he sends you down a rabbit hole than he does if he sends you towards the key. The hard-nosed businessman will send you to where he makes the most money and make you fear the other option.
This is known as a conflict of interest. He has a choice of making more money or teaching the customer. Although he can make some money and teach the customer, he won’t get as much money if he teaches the customer.
B. The 5 Topics in this Video
In this video, I’m going to discuss the following 5 topics.
- Do Gurus Encourage the Wrong People into Trading?
- Is Technical Analysis Just Superstition?
- Are Advanced Charts Red Herrings?
- Nonsensical Trading Explanations
- The Guru Box and How to Think Outside it
These topics might seem unrelated. However, they are all connected.
When I get to the last topic, I will join the dots and you will see the full picture.
The full picture help you to answer these 2 bigger questions.
1. Are you learning from a guru or a “fake guru”? I am not going to answer this question. I will provide information. It is up to you to decide whether an online teacher is a fake guru.
2. What is the rabbit hole and what is the key? I wouldn’t get too excited about me telling what the key is. Even with the key, it still requires a lot of work and thinking, along with an aptitude for this type of work.
First, I need you to understand how the fake guru business model works. As I go through the video, you can work out for yourself, whether any gurus in the horse racing niche fit into this model.
So, I will start by defining what a guru is and what a fake guru is.
Definition of a Guru
The word “guru” is a Sanskrit word that means, teacher or expert. Therefore, I will use the word “guru” to be synonymous with the word “teacher”.
In internet marketing world, the word “fake guru” means something else. Let’s look at how the fake guru model works.
The Fake Guru Model
So, this is how the fake guru model works.
1. Get Followers and Build a Relationship
Firstly, he starts by getting a few followers. These will accumulate over time. He builds a relationship with his customers. Gurus often establish a relationship through an automated email sequence when you sign up to their website.
Another example of relationship-building is when a follower writes a comment, and the guru likes the comment. This causes the follower to feel as if someone he sees as an authority has praised him.
This relationship is a one-way relationship. The guru spends hardly any time on establishing the relationship. The guru has 1000s of subscribers. It is unlikely that any subscribers are special to him. However, not only do many followers see the guru as a kind of friend, but as a friend of higher status.
2. Build 2 Types of Authority
Secondly, the fake guru builds authority. He presents himself as the most important (or one of the most important people) in his niche. He needs you to perceive him as an authority on his subject because he needs you to blindly believe anything he says without proof. Many people tend to blindly believe someone, who they see as an authority. The fake guru is an expert at exploiting this weakness.
The word “authority” has 2 meanings. You can be an authority on a subject which is what I have just talked about. You can also be an authority as in a boss. Because the fake guru might not really be an authority on his subject, he doesn’t want to get involved in any discussion. He wants to dictate rather than debate.
People, who question him, may be subjected to ad hominem attacks. Typically, people, who question them, are called “negative”. However, some go further and call them “trolls” or “haters”.
They may make videos complaining to their followers about these so-called negative people. This behaviour may result in their followers attacking any dissenters in the comments section of their video. I mean normal people, who are upset by a social media comment, don’t make a video and tell their story to 1,000s of people across the internet, who they don’t even know.
This avoidance of discussion is a major red flag. If you are really interested in your subject, you would enjoy discussing it. Even if you are a winning trader, no-one is so good at trading that they can’t learn something new. Even if you have been trading longer than someone else, it doesn’t mean that you know everything that other person knows.
3. Monetise the Business
Thirdly, he monetises his business. Both fake gurus and online teachers may make a profit by getting more subscribers to their YouTube channel. They may also make a profit from affiliate products and courses. There is nothing wrong with that.
4. Marketing Disguised as Teaching
Fourthly, there is marketing. The fake guru’s marketing strategy is to pretend he is teaching you the skill you need, when really he is re-wiring your belief system to get sales.
The result is that you never learn what you want to learn, although you might believe that you are learning something useful. This keeps you a subscriber indefinitely. Eventually, you might buy the guru’s stuff. If the guru’s stuff doesn’t work, you might buy more stuff. The more extreme fake gurus will make you feel that you are always one purchase away from success.
To keep steps 3 and 4 of this model this going, the fake guru can never provide you with the solution that you are looking for. He may go even further and actively prevent you from finding the solution. This is because once you have the solution, you won’t waste time watching his videos and you won’t buy any more stuff from him. In other words, if you find the solution, you will leave the flock.
No Endpoint to a Relationship with a Fake Guru
There is no natural endpoint to your relationship with a fake guru. You are never meant to leave his flock. You are always worth something to a fake guru, even if you watch ads on his Youtube channel once in a while.
Contrast that with a teacher. When you take a course from a teacher, you should have the skills that you can use. For example, if you buy a course on a programming language, you should be able to write programs in that language by the end of the course. In other words, by the end of the course, you don’t need the teacher any longer.
Sports Trading is Gambling
I am going to address a question that some people may think is controversial in a minute. Before I do that, I want to remind everyone that trading is a form of gambling. The idea is that you find situations where you are gambling with the edge in your favour. These are known as +ev situations, where ev stands for “expected value”.
Sports trading is a fancy word for betting that the odds will move up or down. Because the word “trading” is also used in business, it makes betting sound respectable.
Are the Gurus really Traders?
Many business models depend on customers believing that the guru makes loads of money by using the skill that they are trying to sell you? When a guru repeats over and over that he makes loads of money by trading and the number of years that he has been trading, he is establishing “social proof”.
When he shows trades with large sums of money, he may appear to be teaching you something. However, he is re-enforcing his social proof. You don’t know that these are his trades. For all you know, the guru could have bought the video from a real trader and done his own voiceover. Even if they are his trades, you don’t know how many of his other videos ended up in the recycle bin. Most of us have heard of multi-accounting. It is possible that a guru could have made a deal with a genuinely successful trader where they both profit. The guru could have lent his betting exchange account to a real trader, which would make the guru’s account records look as if he is a winner.
How the Guru gets You to Lose Your Critical Thinking Skills
If a guru said, “I don’t make money trading. However, I will teach you how to trade”, you might not be impressed enough to listen to him.
If a guru didn’t tell you whether he won at trading but didn’t tell you whether he won, you might listen to him. However, because you don’t know if this person is the real deal, you would ask yourself if what this guru was saying made sense. In this case, you are still using your critical thinking skills to assess the validity of the guru’s ideas. You are not just blindly believing.
When a guru is aggressive in his use of social proof, and says “I make tons of money by trading. I am the best. I will teach you how to trade” the result is that many people to believe him blindly. When someone positions themselves as the expert, who can never be wrong, some people take in whatever the guru says passively.
Indoctrination
In other words, some followers become susceptible to indoctrination. This is similar to how followers of cult leaders respond. Everything that the leader gets praised by the followers, even if the leader is talking a load of drivel.
If the guru is not really an expert, (in other words, if he is winging it), his business is fragile. Just like a cult leader, if the followers stop believing that the cult is the superior being that he says he is, they will abandon the cult and the cult will fall apart.
Why We Should Question The Businessman
You might think that asking the question whether these businessmen, are successful traders, is out of order. Understand this. As soon as someone starts selling something, they are a business. Almost all businesses face conflict of interest situations.
Why do you think regulatory bodies, such as Ofcom, Ofgem and the UK Gambling Commission, exist? It’s because we can’t and shouldn’t assume that any business, if left unsupervised, will do the right thing.
The guru is just a spokesperson for his own business. The Inland Revenue sees the guru’s activities as a business, and I see them as a business as well.
When I question the guru’s marketing strategies, I am questioning a business and not a person. When they call people, who question them names like “negative”, they are trying to take the discussion off the table.
However, these people are influencers. This means that some of their followers would like to be like their guru – not in every way but in certain ways. I will explain later how their videos may be influencing people into gambling. Their ability to influence people in the gambling niche requires the gurus to be able to present themselves as successful gamblers. This type of marketing even has a name. It is called “influencer marketing”.
Given that these gurus’ businesses make money from influencing people in the gambling niche, they should be under scrutiny and the discussion as to whether they are winning traders should not be off the table.
Some gurus repeat over and over that they are traders and that they win at trading. Normal people don’t repeat themselves so often. People, with short term memory loss, such as dementia sufferers and drunks, may repeat themselves.
Other than those reasons, when someone repeats the same thing over and over, we should always ask ourselves what their goal is.
The Power of Repetition
Repetition can be a sign of dishonesty. A 1977 study found that people have a tendency to believe that false information is correct after repeated exposure. This tendency became known as the “Illusory Truth Effect” (Hasher et al 1977).
In addition, people, who use propaganda, have long known that repetition can get the masses to believe a lie.
“If you tell a lie big enough and keep repeating it, people will eventually come to believe it” – Goebbels, 1941
I’ve known people personally, who say that they win at gambling, who obviously don’t. Why do they do this? Probably, for self-esteem. They want others to think that they are clever.
If a person would lie about their earnings for self-esteem, is it not possible that a person would lie about their earnings if their business depended on it?
I’m not saying that they are not traders or winning traders. I’m just saying that, we should keep our minds open when we don’t know something for a fact.
The idea of internet marketers lying about their earnings is not new. I will explain how things work in the make money online niche. This niche is notorious for its fake gurus. There are YouTube channels that have the sole purpose of exposing fake gurus in this niche. As you go through this video, I want you to ask yourself if you think there are any commonalities between the marketing style of the make money online guys and the sports trading gurus.
Fake Gurus in the Make Money Online Niche
In the make money online niche, many gurus lie about themselves and show fake screenshots of their earnings.
The typical make money online fake guru shows a rented Lamborghini in his ads and pretends that he owns it. He rents a mansion for filming and pretends that he lives there. Some gurus even hire models to hang around the swimming pool in their bikinis and pretend that the models are his friends.
As for the guru showing his earnings, these are easily faked with an html editor. There was a guru a few months back, who posted his monthly earnings. The list was supposed to be a computer-generated screenshot. He forgot to put in the comma to denote the 1000s in one of the numbers.
So, we have social proof, social proof and more social proof. In all of these cases, these are examples of fake “social proof”.
These sell courses for 4 and 5 figure sums. The message that they are giving is, “I am living the dream. If you buy my course, you could be living the dream as well”.
The courses could be on any make money idea, such as affiliate marketing for example.
The Sales Page
Typically, the guru’s sales page would start with a back story, where the guru would explain how he discovered the system. The back story is very important to gurus. Often, they will use a rags to riches back story or a how I hated my job and now I am living the dream back story. The idea is that they are saying, “I was once like you. If you want to get out of your situation and live the dream, follow me. I can teach you”.
However, the back story also works as a relationship builder. If you identify with the story, it can make you feel some empathy for the guru.
Then, you will see the screenshot of the earnings that he claimed to have had. The guru will tell you that there are no skills or experience required. In other words, they say that anyone can do what the fake guru did to make money. Then, there will be testimonials.
So, the earnings and the testimonials are both social proof and the skills required show that there is no barrier to entry on to the course.
Did he make money by selling courses?
The fake guru may be a millionaire. The question is, did the guru, who is selling a course on (say) affiliate marketing, make his money from affiliate marketing or did he just make his money by selling courses on affiliate marketing? Often, these gurus made their money just by selling courses but pretend that they got rich by using the skill that the course is supposed to be about.
We can’t assume that anyone, who is trying to sell you something is telling the truth
Therefore, we can’t assume that anyone, who is trying to sell you something, is telling the truth about his life or his earnings.
The only way that you can tell if someone may be telling the truth, is if what they are saying makes sense. We all make mistakes. Therefore, we all say things that don’t make sense from time to time.
However, if someone is giving advice that doesn’t make sense and there are inconsistencies in their opinions and behaviour, you should question whether they have an agenda. The agenda will usually be to steer you in a direction, that enables the fake guru to make more money.
Question 1: Do the Gurus Encourage the Wrong People into Trading
So, now I will focus on sports trading and go through the following 5 points starting with the first point; Do the gurus encourage the wrong people into trading? Do gurus present any barriers to entry when they invite people into trading? Or are they just interested in numbers of subscribers and customers?
No Barrier to Entry into Sports Trading
I’ve heard marketers talk about sports trading as if it is the next natural step after matched betting.
In my opinion, the answer to the question whether matched bettors should become traders is generally no. I’m not saying that this answer applies to all matched bettors. What I am saying is that a matched bettor is no more qualified to become a sports trader than a random person on the street.
You see, matched betting has nothing to do with trading.
No Barrier to Entry into Sports Trading – Matched Bettors
Most matched bettors join a site that teaches matched betting. Then, they follow a set of instructions to cash out bookmakers’ bonuses.
Matched betting is a step-by-step procedure and it isn’t gambling. By contrast, sports trading is not a step-by-step procedure and it is gambling. A matched bettor does not have to know anything about a sport or whether the odds are too long or too short and form an opinion. Sports trading involves looking at variables and forming an opinion.
Given the dissimilarity across all measures, I would say that the gurus do not present any barrier to entry into sports trading.
You will hear people say that trading is a higher level than matched betting. You can’t compare the 2. It’s like comparing a butcher with a candlestick maker. One isn’t a higher form of another. They are just different.
You might think that the matched bettor has other skills. The only things that matched bettors have got in common with a betting exchange trader, is that they know how to back and lay a horse on a betting exchange and they know how to use a calculator. Neither of these skills are advanced skills as most people can learn these skills in less than half an hour. Therefore, there aren’t many skills involved in being a matched bettor.
In addition, some of the gurus encourage you to matched bet in a way that gets your accounts gubbed quickly. If you take their advice, you will end up losing your bookmaker accounts and your matched betting income. You look around to find a new way of making money and you may end up a student of the sports trading guru who gave you the advice that got your bookmaker accounts gubbed. Getting your accounts gubbed quickly works out nicely for the trading guru as he gets customers faster.
No Barrier to Entry into Sports Trading – Punters
Some of the marketers talk about punters and ex-punters trading. I’ve heard more than one say, “if you are an ex-punter, you could become a trader”. The problem here, is that many marketers tell punters that they don’t need to read form. So, what background does a punter have that would qualify him to become a trader?
A punter has 2 skills. He knows how to place a bet and he knows how to read form. If he doesn’t need to read form, this leaves one skill. That is, the ability to place a bet. Therefore, the marketers are saying that just having the ability to place a bet means that you are qualified to attempt to become a trader.
A punter does have experience of risk. However, if the punter was not a good punter, is he likely to have any success as a trader? Probably not. When ex-punters are encouraged into trading, they are encouraging ex-gamblers to become gamblers again. It’s likely that most ex-punters were not successful as punters otherwise, they would have carried on punting. Therefore, encouraging them back into gambling may not be the most responsible thing to do.
You might think that casinos and bookmakers advertise their products. However, there is a big difference. The casinos and bookmakers advertise their products as entertainment products.
Sports Trading Gurus are Selling the Dream
By contrast, some gurus in the sports trading niche are selling the dream. They make videos talking about leaving your job. I’ve seen talk about making £100,000 in a year in their videos and interviews with real or fake pro-traders telling you how winning at trading changed their life.
Winning at sports trading is not easy. The statistic bandied about is that 95% of people lose at sports trading. It is unlikely that all of the remaining 5%, who are profitable, are making a living.
The gurus are selling the dream, knowing that very few people will ever make a living from trading. There is one guru, who makes videos, where he appears angry with bookmakers because he thinks that they don’t care about problem gamblers. Yet, he sells the dream. However, to be fair on this guru, hypocrisy doesn’t mean that he is wrong about bookmakers.
As the sports trading gurus present minimal barrier to entry, they know that a subsection of their followers will be gullible. Being gullible doesn’t necessarily mean that the person is unintelligent. People can become susceptible to indoctrination because of their life situation.
For example, when people have lost their job, they might be desperate to find a way to make money. They may clutch at any straw. Another example is when people are depressed, they may be desperate for something to take the edge off their depression.
This is a benefit to the guru as they can shape vulnerable people’s belief systems more easily. Cult leaders know this. This is why some religious cults look for vulnerable people to recruit.
As only 5% of people win at trading, they are likely to have above average intelligence and have specific skills.
So, what are the skills.
Problem solving, analytical and critical thinking.
I want to make it clear that I am not advising anyone to trade. I am just saying that the skills that I believe help in trading are problem solving, analytical and critical thinking and this is just my opinion. This isn’t a complete list of activities that might mean that you may have the skills to become a trader. However, you get the gist.
Just playing one of these games doesn’t mean that you have the skills to potentially succeed at trading. You have to have been above average at these games.
In addition, I’m not saying that you have to fall into one of these categories to have a chance of succeeding at trading. However, I would say that you have to see yourself as having good problem-solving, analytical, and critical thinking skills. In addition, even if you have a natural aptitude for trading, it can be a long time before you figure out a winning strategy.
Here’s a question. Why don’t the gurus encourage engineers, scientists and accountants into trading? They probably have a more suitable background for trading compared to a random matched bettor or punter. Perhaps, it is because the gurus can’t pull the wool over these people’s eyes.
Statistical Awareness
If you are trading, you also need to be statistically aware. Most people have a weak understanding of statistics. Some people don’t even know the difference between raw data and statistics. Then, there is the problem of generalising from small sample sizes to large populations. Paradoxically, most people also think that they geniuses when it comes to statistics. If you don’t have a good understanding of statistics, it is easy to be fooled by marketers.
When you decide to learn to learn to trade from other people, you are entering an absolute minefield of misleading information. When you see so many people believing in such information, it’s easy to fall for the bandwagon fallacy and go along with the crowd.
This is why I said earlier that you need strong analytical and critical thinking skills to trade. You need these skills to separate the valid information from the misinformation.
Question 2: Is Technical Analysis Just Superstition?
So, now to the next topic: “Is technical analysis just superstition?” The sports trading gurus in the horse racing space have imported a number of concepts from financial trading. These concepts fall under the subject of technical analysis. If you don’t know what technical analysis is, don’t worry. You probably won’t want to use it after watching this video. In any case, all will be explained.
The Ladder
Typically, the sports trading gurus encourage people to trade in the last 5 minutes before a horse race. They use ladder software for this.
If you don’t know what a ladder is, this is what a ladder looks like. Each ladder represents a different horse. The odds are presented vertically. The ladder makes it easier to visualise how the odds are moving compared to just looking at the Betfair interface. In addition, you can get your money in and out of the market faster by using the ladder. If you are trading on horses, a ladder is essential.
The usefulness of the ladder is not the issue. The issue is how these ladders and (probably, useless) courses on trading are marketed.
The gurus have made videos that include concepts, such as “support, “resistance”, “candlestick charts”, “order flow”, “chart patterns”, “advanced charts”, and the “MACD indicator”. In some ladder software, you will find a load more of these types of ideas including Bollinger Bands, Japanese candlestick charts and more.
Several of these concepts have been imported from the financial markets and fall under the subject matter of technical analysis.
You don’t need to understand what any of these words mean because the concepts are likely to be completely useless for sports trading.
Fundamental Analysts versus Technical Analysts
In financial trading, there are 2 categories of traders. Fundamental analysts research a company and invest on that basis. Technical analysts invest on the basis of price movements and volume.
The equivalent of fundamental analysis in horse racing would be researching a race (ie reading form). I’ve seen videos from the most famous gurus, in the horse racing niche, discouraging people from reading form.
So, they would be classed as technical analysts. They have made videos talking about support and resistance and order flow.
The question I have, is “are we being duped?” Well, I’m not being duped. However, are they duping other people with these so-called indicators.
I think so and I am going to explain why.
Technical Analysis doesn’t Work in Financial Trading
Technical analysis hasn’t been proven to work in financial trading. +
While a lot of financial traders say that they make money from using technical analysis, academic examination frequently suggests that it has minimal predictive power [Browning, E.S. (July 31, 2007). “Reading market tea leaves”. The Wall Street Journal Europe. Dow Jones. pp. 17–18].
This opinion was published in the Wall Street Journal.
So, here is another article on the Motley Fool website by Anand Chokkevelu. The Motley Fool website is one of the biggest investor websites online. The title says it all – “Technical Analysis is Stupid”. He goes on to say, “I define stupid as anything that loses me money. On that basis, I find technical analysis quite stupid indeed”.
To get this into perspective, the roots of technical analysis can be found in the 17th century (Joseph de la Vega, Confusión de Confusiones, 1688). That’s over 300 years ago.
So, after more than 3 centuries, technical analysis hasn’t been proven to work in financial trading.
What’s more, hardly anyone succeeds at day trading in the financial markets. I’ve looked on the internet to find out what percentage of financial day traders make money in the long term. You get 2 sets of results.
The websites, that make a profit from getting people to trade (such as affiliates and tipsters) claim that 10 – 20% of day traders make money.
By contrast, the academic research suggests that under 5% of day traders make money. There is some research that suggests that almost zero% of day traders make money. Academic researchers are less likely to be biased compared to people, who are in the financial trading business.
Perhaps, some people do win at financial trading. However, it might only be fundamental analysts, who win.
The Problem With Support and Resistance
I want you to understand where I am going with this. The sports trading gurus have brought a flawed system from financial trading into sports trading. Some have also programmed a bunch of these equations into the ladder software in order for us to make “Advanced Graphs”.
We do have the choice whether to use these graphs. However, this is already starting to remind me of snake-oil salesmen.
One of the most fundamental concepts in technical analysis is support and resistance. The Sports Trading Gurus have fudged the Use the Terms “Support” and “Resistance” to mean something different to the meaning in Financial Trading. This is important because, in my opinion, they have created a superstition that many traders believe in.
The meaning of support and resistance in financial trading refers to lines where price repeatedly gets rejected. On this graph, price gets rejected 4 times as it goes up towards the red line. Price gets rejected 3 times as it goes down towards the green line. The red and green lines would be called support or resistance, depending on whether you are a buyer or a seller.
If you are a buyer and you want the price to increase, the green line is support because, according to the theory, it has a blocking effect on price going down below the line. If you are a buyer, you don’t want the price to decrease. Therefore, this line supports your trade. The red line is resistance because, according to the theory, price will struggle to cross that line. As a buyer, you want price to increase and therefore the red line is a resistance to the success of your trade.
If you are a seller, you want price to decrease. In this case, the red line will be support and the green line will be resistance.
The original meaning of these terms does not work well with sports trading graphs, although some people have tried to replicate this in a Betfair graph. In general, the horse racing odds don’t zig-zag enough to use the concepts of support and resistance in this way.
So, what did the gurus do? They invented new meanings for support and resistance.
New Meanings for Support and Resistance
They use the word support:
1. When they have a trade running, and the odds move in their favour
2. When a big lump of money appears on the ladder behind their trade
3. In relation to the crossover points where the tick sizes change.
The first of these is a colloquial term that a punter’s or horse racing commentator might use. They might say that a horse is getting support instead of saying that a horse is being backed.
The second and third are superstitions invented by the gurus. If a big lump of money really did act as support and resistance, you would be able to find a way of winning by backing and laying around these points.
Support and Resistance and Selective Memory
It’s a case of selective memory. This is the abstract from a review article by Baumeister and colleagues. In the article, the authors cite numerous published experiments that strongly suggest that we have a tendency to retain bad memories more than good memories. There is the repetition effect. If a guru keeps repeating an opinion to you, you are likely to remember and believe it.
What are the implications in the context of support and resistance?
We remember winning trades when the odds reverse at the “resistance point”, but we forget the times that the odds break through this point.
So, this is a similar idea to the article that I just showed about bad memories being stronger than good memories.
We remember large sums of money on the “resistance point”, but we don’t notice when there is a normal amount of money on it.
Again, this is similar to the article about bad memories being stronger than good.
People remember when the odds reversed on them at the crossover point, but they don’t remember when the odds reversed on them at other points. This is similar to an old superstition, “if a black cat crosses your path, you will have bad luck”. If someone believes that, they will notice every black cat that crosses their path and then, attribute anything that goes wrong to the black cat. However, they won’t notice when a ginger cat or a dog crosses their path and they have a bad day.
Technical Analysis is Superstition
In the absence of any evidence that support and resistance points exist, we are dealing with superstition and not facts.
The gurus present an idea about support and resistance that sounds intuitively correct. However, if you pay attention to these points, you will see that these points do not have special qualities. You’ll sometimes see the odds go down and straight through a crossover point for a few ticks. Then, the price will come straight back up through the crossover point. This means that the crossover point didn’t work as resistance on the way down and it didn’t work as support on the way back up.
The made up meanings of support and resistance may seem like the gurus are confused. If their followers believe that the technical analysis concepts as useful for sports trading, the gurus benefit financially. This will be explained later.
Sports Trading Markets are Completely different from Financial Markets
I want you to understand the full absurdity of the guru promoting stuff from financial trading. The sports markets work completely differently to the financial markets.
Financial Markets are Not held together by the 100-102% total percentage
In the financial markets the average price of all stocks can drop. This is called a bear market. The opposite is a bull market where the average price of stocks increases.
In sports trading, the odds of all the horses in a race cannot decrease or increase. If the odds of one horse reduce, the odds of at least one other horses must increase. The total percentage of the market must remain at just over 100%.
There is no such percentage holding the prices together in the financial markets.
b. The horse racing market starts with tiny amounts of money, the money builds up and finally the market dies. The market doesn’t exist once the horse race is over. The FTSE, by contrast, will be here tomorrow and next week and next month.
This reminds me of snake-oil salesman. In the 18th and 19th century, snake-oil was marketed as a cure for all diseases. There was no evidence that it worked on any diseases. Similarly, technical analysis is marketed as a solution for all markets. There is no evidence that technical analysis works on any market. So, here’s my stamp of disapproval.
It would be incredibly fortunate, if a set of equations, that have never been proven to work in the market that they were created for, just happened to be useful in a market that had a completely different structure.
This generalisation of mathematical equations from financial to sports trading, is an example of a logical fallacy known as the hasty generalisation fallacy. The question is, have the gurus accidentally fallen for this fallacy? Or have they deliberately got their followers to fall for this fallacy?
From a marketing point of view, the guru gains when their followers believe in technical analysis.
For example, the use of financial trading jargon helps to build authority. It helps the guru to sound intelligent because a lot of his audience doesn’t really understand what these words really mean or how these concepts can be used. Because technical analysis sounds mathematical, some of the guru’s audience may think that he is a mathematical expert.
Importantly, the use of the financial trading equations helps bump up the number of so-called “advanced charts” in the ladder software. This is a point I will come back to later.
For now, let’s talk about graphs in general.
Question 3: Are advanced charts red herrings?
Subconsciously, when we see a graph or an equation, we assume that we are looking at something scientific or mathematical. We may believe this, even if we don’t understand the equation and we don’t have a clue how to interpret or use the graph.
When we don’t quite understand something, it is easy for someone to pull the wool over our eyes.
Red Herring Graphs
There is a marketer, who has this setup, when he shows his trades. He has 4 ladders and a timer.
Then, he has 4 Betfair graphs at the bottom of his screen. Each Betfair graph includes a line and volume bars.
He has 4 graphs at the top of his screen, which I think are volume bars. He has a market overview chart with about 6 lines on the left of his screen. The charts above the ladder and the market overview chart are fast-moving charts, where the information moves and disappears off the screen.
Is it possible for the human mind to process this amount of information?
How many bits of information does this guru have to monitor, if he is using all of this information?
We can count the Betfair graphs as 2 bits of information each because there is a line and volume bars on each graph. We count 1 for the red line and 1 for the volume bars. That’s 8 bits of information.
There are also 4 ladders that he is looking at. So, we are up to 12 bits of information.
Then, there are the 4 volume charts at the top of the ladder. We are now up to 16 bits of information.
Then, there is the market overview chart which has 6 lines, which is 6 bits of information. We are up to 22 bits of information.
Finally, there is the timer, which is 1 bit of information.
This takes us to a grand total of 23 bits of information.
Can the marketer process 23 bits of information, and put all of this information together to reach a conclusion?
Can the human mind really process this much information?
Unfortunately, according to the science, it is unlikely.
Miller (1956) wrote a psychology paper that explains that the human mind can process 7 plus or minus 2 bits of information. This means that the majority of people can process between 5 and 9 bits of information. There will be some people, who are outside this range. Miller’s paper is highly cited and is still cited in psychology textbooks today.
In any case, Miller’s view on the number of bits of information that we can process may be an overestimate.
In a 2011 journal article, Farrington suggest that the limit for working memory is three, and sometimes four. She also writes, “given too much novel information at one time, learners and performers can be derailed by cognitive overload”.
However, let’s go with the Miller result. An ability to process 23 bits of information is 8 standard deviations from the mean. If you don’t know how much 8 standard deviations is, this piece of information might help. 99.73% of people fall within 3 standards deviations from the mean.
To be fair, we probably all have information on our screen that we don’t often use. However, 23 bits of information is a long way off the scale for most people’s attentional capacity, especially as there is other literature that suggests that Miller’s 7 plus or minus 2, is an overestimate. In fact, 23 bits of information is so much that, the information might act as a distraction for most people.
Interestingly, when this marketer explains a trade, he seldom refers to the graphs.
When you are observing a marketer, you have to ask yourself what other possible reasons that could have for putting so much stuff on his screen.
When you see all the graphs on his screen, it gives the impression that the marketer is highly intelligent. This creates authority.
It’s not just about authority. There is another possibility.
Your Own Brain is Supposed to Reach Conclusions
There is a trick that I’ve noticed salespeople use on several occasions. I’ll illustrate this with a real-life example that is outside the sphere of trading. I went to a high street shop once to buy a computer. Once that I had decided to purchase, the salesman asked me if I wanted to buy this antivirus software. I said, “No, because the pc comes with antivirus software”. The salesman looked confused and said,”I wonder why other people buy antivirus software then”.
It’s a statement that is really a question. Because the salesman didn’t have a counterargument to my objection that the pc comes with antivirus software, he asked a question. His last hope of making a sale is that my own brain figures out a reason to buy the antivirus software. Perhaps, I might think that the antivirus software on the computer is an inferior product and that it won’t keep my computer safe enough. That would be an explanation why people buy superior software separately. The salesman doesn’t want to lie. Therefore, he tries to trick me into coming up with that conclusion myself.
Anyway, my reply to him was, “Because people like you prey on people’s ignorance”. I said it with a smile and in a friendly way. He apologised to me later and explained that the bosses have told them that they have to try and sell the antivirus software in this way.
Back to Graphs
I don’t think that I have heard the gurus actually say that graphs are important or that the financial trading concepts are important. Therefore, they could be using a similar technique to the salesman in the computer shop.
By the sports trading guru leaving graphs all over the screen, the followers’ own brains may reach conclusions. You may feel that the path to successful trading is to understand these graphs and how they are used. You may feel that if you hang around and watch all of the guru’s YouTube videos, you might catch a piece of information that explains everything. You might feel that your confusion will be reduced if you buy the guru’s video course.
By the way, it’s not just one marketer, who claims to use a ton of graphs, while trading. Recently, I saw another guru making a graph of the MACD, which stands for “moving average convergence divergence”. Remember the MACD is a financial trading concept. He didn’t explain what the MACD is. He didn’t even say that the MACD is useful for trading.
However, the guru said that he uses a lot of graphs but doesn’t show them when he is making a trading video. This is a guru, who presents himself as a big winning trader. Just by creating a graph of the MACD and talking excitedly about advanced charts, he leaves your brain to reach the conclusion that the MACD and advanced charts must be useful for trading. It’s almost natural to come to this conclusion.
Otherwise, why would he show this on his sports trading channel?
When I am trading, I normally have the Betfair charts on my screen.
Aside from the Betfair graphs,
I don’t need no stinkin’ graphs!
This might seem like an extreme position. However, remember, academic research shows that hardly any financial day traders make money. The financial traders have access to a much wider range of graphs than sports traders. In 300 years, graphs and technical analysis in general, has not been proven to work in financial trading.
In my opinion, the advice to focus on graphs and technical analysis in sports trading is a hoax, especially when this advice is combined with gurus saying that, “you don’t need to read form”.
Before I move onto the next topic, I have a rhetorical question similar to earlier. If graphs are important or even useful, why don’t the gurus suggest that scientists, mathematicians and engineers and other people, who understand graphs enter their world of sports trading, instead of random matched bettors, punters and ex-punters?
Question 4: Nonsensical Explanations
So, before I join the dots and reveal the full picture as I see it, I will talk about nonsensical explanations. Most of the time, the marketers don’t explain anything. You get a lot of random comments, nonsense explanations and plenty of waffle. Random comments include statements such as “there’s money come into the market”. Although you might believe that you are being taught something, this is not an explanation because the marketer does not say how the money coming into the market affects his decisions.
Let’s look at some common examples of nonsensical explanations.
Nonsensical Explanation #1: “The Up-side is Bigger than the Downside”
Nonsensical explanations rely on the explanation sounding intuitively correct. There’s a marketer, who shows trades, where he lays a very short-priced favourite. The favourite has odds of around 1.5. Obviously, the odds drift by a huge amount and the guru makes money.
His explanation is that he layed the horse because “the upside is bigger than the downside”. Again, this explanation may make intuitive sense, but it is an absurd explanation.
You also have to consider how often and by how much a short-priced favourite gets backed compared to it drifting.
You might lose small amounts so often that you are still losing when you get a big drift in the odds.
If you think about it, the Betfair odds go up to 1000. This means that the upside is greater than the downside for the odds on most horses.
Why stop at horse racing? If “the upside is bigger than the downside” has any logic, you could just lay Djokovic and expect to make a profit in pre-match tennis trading just because he is at short odds. Similarly, you can lay Liverpool when they are at short odds and expect to make an overall profit.
Why stop at sports? If “the upside is greater than the downside” makes sense, we could all go and buy stock market shares and become millionaires. If the share price of a company is £5, the downside is losing £5. That would be when the company goes bust. The upside – well, that is infinity.
Nonsensical Explanation #2: “The second favourite is drifting and therefore, the favourite’s odds will shorten”
Another common example of false logic is when a marketer has backed the favourite. You will often hear the marketer say something like, “the second favourite is drifting, which means that the favourite will shorten”.
This may make intuitive sense. However, it does not make logical sense. By the time, the guru has made this comment, the odds have already adjusted. During the last 5 minutes before the start of a race, the odds of all the horses add up to around 100-102%.
If you try and back a favourite, every time that you see a second favourite drift, you will probably lose in the long run.
Obviously, the favourite does what the marketer says will happen in his video. Otherwise, the video would probably have ended up in the recycle bin. However, we have all seen favourites and second favourites both drift, while the other horses get backed. We have also seen both the first and second favourite both getting backed, while the other horses drift.
Nonsensical Explanation #3: “I exited the trade because I don’t want to be too greedy”
Your emotions should not influence whether to stay in a trade. When you are in a winning trade and you are deciding whether to exit or stay in the trade, you can ask yourself the following question:
“If I wasn’t already in the trade, would I enter the trade now?”
If the answer to this question is “no” or “I don’t know”, it means that you don’t think the situation is +ev and therefore, you should exit.
Nonsensical Explanation #4: “I entered the trade because it is the safest position”
I’ve only seen this one once. However, I didn’t like this explanation because of the context. He is saying that where he was placing his trade, is safer than placing the trade anywhere else. An explanation like this suggests that the trader has already decided to trade on the race without considering the option of not trading.
You need a +ev situation to enter a trade and calling a position “safer” does not imply a +ev situation.
In this context, the marketer is acting as if trading is easy. The gurus often give the impression that you can casually saunter up to your computer, open a race up 5 mins before the start, splash large sums of money all around the ladder and win. I’ve even heard one of the marketers compare trading to going an ATM machine. Remember the statistic that 95% of people lose at trading. Therefore, winning cannot be that easy.
With their kind of thinking, I would have thought that winning would be especially difficult.
We’ll do one more before putting this all together.
Nonsensical Explanation #5: Promoting a Mug Punter Attitude to Money
The gurus present a mug punter attitude to money. When they go into the green but have not closed the trade, they might say, “I don’t have to worry because I’m so far in the green”. The second one on the list “Keep your losses low and let your winnings run”, is pretty much the same kind of idea. The one at the bottom of the screen came from a video where a guru did a pre-match football trade. He won about £7. He said something like, “now I have money to play with when the match goes in play”.
He didn’t seem to any clear reason to bet in-play (or pre-match) for that matter. It just looked like someone having a punt.
All of these statements have one idea in common. That is, that is, that money has changed its value just because you have won it.
A professional would not think like that. When you are ahead, you do have to worry because you could lose the money that you have already won.
This is similar to the mindset of a mug punter. He wins money and, because the money is profit, he believes that it doesn’t matter as much if he loses this money. As I said, money doesn’t change its value just because it’s winnings. If you think like that, you have a serious leak in your game.
Professional gambling isn’t about a small sum of money not giving you enough excitement and therefore, you can gamble it to win more. Imagine if a corner shop owner decided that if a customer spends less than £1, he will gamble that money because that amount of money isn’t exciting enough. He would go bust pretty quickly.
Every small amount of money adds up. Small wins cancel out small losses. Lots of small wins cancel out a big loss.
It’s about thinking about the money over a life-time – not over a one trade, one day or even a week.
What I am talking about here is mindset. Forget the self-help mindset drivel that the gurus teach you. You know like don’t spend too much time on social media.
Whenever you have a decision, think in terms of ev expected value. Whenever someone gives you trading advice, ask yourself if it makes sense.
Joining the Dots
Before, I go onto the last topic. I am going to join some of the dots. We can’t join the dots and make a teaching model. On the one hand, we have the appearance of science with the graphs and technical indicators. On the other hand, we have nonsensical explanations for trades combined with a lot of waffle.
So, let’s see if we can join the dots to make a business model.
First, I will explain how talking nonsense is good for business and secondly, I will explain how graphs are good for business.
Nonsensical Explanations and Marketing
Nonsensical explanations fit the marketing model. That’s right. You can actually make money by talking garbage.
The key to making money by talking garbage is your customer’s intuition. All of the nonsensical explanations that I described make intuitive sense. Because they make intuitive sense, these are simple ideas that people can easily understand. This is an easy way of getting followers to feel as if they have learnt something new.
When an explanation makes intuitive sense, the mind accepts this information quickly and easily. You may even feel that you’ve had a lightbulb moment, where you think that you have suddenly taken a leap in your understanding of the trading game. If you feel that you’ve had an that lightbulb moment, you will feel that the guru is the real deal.
Even intelligent people can accept information that is wrong but sounds intuitively correct, although they will see though it eventually.
As I have said, gambling on any skill game is about expected value or ev. If you start discussing whether a situation is +ev, you may be introducing topics, such as maths, statistics and form. This might scare followers away.
Compare that to the one liner that sounds intuitively correct. It’s easier for the guru to deliver and easier for the follower’s brain to digest.
If you want to market an idea to the average person, you have to make it sound simple. The average person will get scared off, if you tell them that they have to learn new stuff and think.
So, that’s how nonsensical explanations fit the marketing model.
So, now, let’s look at how promoting graphs and a belief in technical analysis fit the business model? If the marketers don’t refer to the graphs when they are trading, why do they put them on their screen and talk about graphs is separate videos?
Bonus Stacking
To explain a possible reason for this, I will use a concept from the make money online niche. The concept is known as “bonus stacking”.
In the make money online niche, the products on sale are mainly digital products. These could be ebooks or videos. Typically, these gurus will add a load of bonuses to their main product. The bonuses will usually be low quality products which are of little or no use to the customer.
The idea is that the bonuses cause the customer to have a higher perceived value of the main product. This makes the customer more willing to buy the product and be more willing to pay a higher price for the product.
So, what has this got to do with the sports trading marketer’s apparent obsession with graphs and technical analysis concepts?
Let’s think of the ladder as the main product. The ladder software companies do not give away bonuses, as such. However, all of the other features (such as the graphs) that come with the software can be seen as bonuses.
Feature Stacking
So, we can call this “Feature Stacking” instead of Bonus stacking. At the time of making this video, there are ladders around that cost as little as £6/month and as much as £29.99/month. For someone to pay the higher price, there has to be more than a ladder on offer. This is because all ladders are pretty much equal.
A person selling a ladder (whether the owner or affiliate) can say, “my ladder is better because it comes with all of these extra features”.
For example, the marketer, who has this set-up, is indirectly saying, “If you want to be a trader like me, you will need a set-up like mine. If you want a set-up like mine, you should buy the ladder that I recommend”.
There is the odd feature, such as automation, that might be useful. However, this feature is only useful to people, who have a method that can be automated. This is likely to be an extremely small number of people. If only 5% of traders win, those who have automated trades will be a small percentage of this 5%.
The bulk of extra stuff that comes with ladders are graphs, many of which are based on financial trading equations. I would imagine that a graph is an easy feature to program into a ladder, especially if the equations already exist.
The question is, do they add features regardless of whether they are useful or not? Do they add features just to bulk up the list of features, which would increase the perceived value of the ladder?
If this is the case, the problem is that gurus will have to try and make potential customers believe that the features are important (or at least useful) to get more sales and attempt to justify the higher price of the ladder.
Do they base their “teaching” around these features?
The usefulness of the features is by implication. Just the fact that these features are in the ladder imply that they are useful for trading. They don’t really teach us how to use graphs.
However, they can limit our thinking by teaching us not to look for information outside their box.
They can try to stop us from thinking outside the box.
Question 5: The Guru Box and How to Thinking Outside it.
The last part of the video is on “thinking outside the box”.
The gurus create a box, within which they want you to think.
In general, the guru doesn’t want you to go outside the ladder for your information. There might be the odd exception to this – mainly, for other types of trading. However, for standard trading pre-race, he generally wants you isolated with the ladder and his advice.
So, let’s define the box.
The Guru Box
Here is the box that the guru creates.
Only think within the ladder.
Only think about the 5-10 minutes before a race.
Only use the information that is provided within the ladder (eg graphs, amounts of money in the ladder)
Do not go outside the ladder, except to watch their videos.
If you ask a question about the usefulness of a variable that is outside the box, you will usually be told directly or indirectly that it isn’t useful.
Effectively you are told, “get back in your box”.
What is Outside this Box?
Form and market movements from 9 am or even earlier. There are other variables that you can look at, such as stable betting patterns.
The gurus have discouraged people from reading form in their videos. Occasionally, they contradict themselves on this issue. One of them made a video recently on using form for betting on favourites. This wasn’t about trading, but betting. I don’t know where he is going with that.
In addition, he has put form figures into his software (after telling people for years that you don’t need to read form). Form figures are not sufficient to make decisions about trading or betting. It’s a case of a little knowledge being dangerous. In fact, the stereotype of a mug punter is a person, who just uses form figures out of a daily newspaper to make betting decisions.
Nevertheless, when you learn from a guru, it seems as though, when form is not in the ladder, “you don’t need to read form”. When form figures are in the ladder, it is something of interest.
Anyway, reading form is an important part of the trading puzzle in my opinion. Why?
Punters use form. If we are trying to predict odds movements, doesn’t it make sense to predict which favourites that punters are going to back and which favourites that they might not be keen on?
Bookmakers use form when they make up their odds.
The racing media, such as the Racing Post and the Sporting Life use form, to make up their betting forecast. The Sporting Life has been publishing racing form since 1859.
Why would traders on horse racing be the only participants in the horse-racing industry who shouldn’t read form or who don’t need to use form?
How about other traders?
Football traders read form. Tennis traders read form. In-play traders, watch the football match, tennis match or horse race and make decisions based on the in-play form.
Why would pre-race horse racing traders be the only traders who don’t need to use form?
There are a lot of websites, where you can get excellent horse racing form. The gurus can’t compete with these sites. They are light years behind them. So, the gurus promote graphs, where there is little or no competition.
The favourite in a race usually has the best form and more favourites win than 2nd favourites. Form is real. It’s not superstition. It’s not a hoax. The odds on a race are based largely on form. There are other factors, such as stable information leaking out. However, form is the most significant factor.
However, some marketers say that you don’t need to read form. Have they tried to use form and found that it doesn’t work? If so, is it not possible that their form-reading skills are inadequate?
Note that form doesn’t fit a business model of no barrier to entry. If you told newbies that they have to learn to read form before they can trade, they might be deterred from trading. Some of these people want instant gratification. They don’t want to have to learn to read form before placing their first trade.
Information for Trading within the 5 minute box
Most of my trades are done within the 5 minute box. Once that last 5 minutes starts, the market is often chaotic. There will be punters, stable connections, traders and possibly bookmakers all of whom, will have a different purpose and have different timings for when they want to enter the market.
As I have said, our attention span is limited. Therefore, it is difficult to make sense out of the chaos.
The way that I trade involves going into the last 5 minutes with a long-term view of how the odds will change on a specific horse.
This requires pre-race research, race selection and obtaining information from the market up until the time of the race.
I read the form either the night before or early in the morning. I write down a list of selections that I am considering trading at some point during the day. I decide whether I expect them to drift or get backed based on their form.
So, before 9 am, I write down the Betfair odds on these horses. I note down the odds again sometime between 11 and 12 o’clock. Therefore, I have odds at 2 time points and when I open the race in the ladder 10 mins before the race, I have a 3rd time point.
During the day, there are a few things that you can look out for. One of the most obvious are flip-flops – for example, when the favourite and second favourite swap positions in the betting.
So, the information I get from the form and keeping track of the odds from morning up until the time of the race, often helps me decide if, whether and how to trade in the 5 min pre-race period.
So, when I open a race in the ladder just before the 5-min pre-race period, I have a chosen horse, a direction that I think the odds will move in and an idea where I will consider entering the trade. If the betting doesn’t unfold as I expect, I don’t trade.
In other words, I open a race in the ladder with a plan and a rough expectation on how the betting might unfold. Having a plan solves the attention problem. I can just focus on one or 2 ladders and the timer.
All of the information for the plan, is found outside the guru 5 min box and the ladder.
Compare that with a guru-taught trader, who opens a race in the ladder with no prior knowledge of the race and no plan.
Followers and Blind Believers Fail
In a moment, I will go back to the question, “are the gurus successful traders?” However, before that, I will summarise. The gurus don’t appear to present any barrier to entry into sports trading. They use the fact that, the newbie views them as authorities, to implant beliefs into the newbie’s mind. These beliefs appear to me to be centred around facilitating sales, rather than helping the newbie develop a trading strategy.
This isn’t just about the money that the newbie spends on courses and ladders or the number of hours that he spends watching pointless YouTube videos. This is about people being sent into a rabbit hole of graphs, jargon and nonsensical explanations.
It’s about the number of months or years that a trusting customer spends trying to win at trading before giving up. It’s also about where the frustration of, not being able to get close to a solution, can lead. That frustration might lead to problem gambling.
All of this occurs because people blindly believe.
The gurus position themselves as authorities. Don’t position yourself as a follower and a blind believer.
So, I’ve described a few ways on how to get out of the box. I’m not saying that these are the only trading options. There will be other ways of trading that I haven’t thought of.
Are the Gurus Successful Traders?
Finally, to the question, “Are the gurus successful traders?”
I am going to look for the answer to this question objectively rather than just give my own opinion. I will use a principle from philosophy, known as “Occam’s Razor”. It’s a simple method.
This is how it works. If there are 2 possible answers, the answer that requires the fewest assumptions is usually correct. In other words, if the first possible answer requires few assumptions to be correct and the second possible answer requires going all round the houses to be correct, we choose the first answer.
So, we have:
Technical analysis and Graphs which are not supported by any evidence.
Incorrect explanations for trades that are simple one-liners that tap into the intuitive mind of the subscriber
A mug punter mentality towards gambling
Telling us that we don’t need to read form, which is something that everyone in the horse-racing industry does.
There are no positives.
Using the principle of Occam’s Razor, the answer would be no, they are not successful traders. Everything that they advise, directly or indirectly, doesn’t make sense. Therefore, we don’t need to make any assumptions to come to this conclusion.
This answer could be wrong. The principle of Occam’s Razor only says that this answer is most likely to be correct.
So, let’s assume that they are successful traders and look at the assumptions that we have to make to reach this conclusion.
The assumption we would have to make is that they know that what they are advising, directly or indirectly, doesn’t make sense.
Why would they do this? In a word, “Marketing”. In fact, I would say that thier model is almost 100% marketing and close to 0% teaching. In fact, the teaching could be seen as a negative percentage because, in my opinion, they are directing people towards superstition and away from real information.
Graphs based on technical analysis are in the software. Therefore, this helps sell the ladder.
If you want to market an idea to the average person, you have to make it sound simple. The average person will get scared off, if you tell them that they have to learn new stuff and think.
This also would explain why they might tell their followers that they don’t need to read form.
It doesn’t really matter whether the gurus are successful traders. If you accept the Occam’s Razor result that they aren’t successful traders, it follows that they don’t have enough knowledge to teach trading.
If you go with the result that they are real traders but the information that they put out is almost 100% marketing, you can’t learn anything from them because they are not teaching.
Therefore, whichever answer you choose to the question, “Are the gurus really traders”, it would mean that we may not be able to trust what they are saying.
Not all business work like this. If I want to learn something, I often look on Youtube. For example, if I want to learn how to use a function in Excel, I might find a video lesson on this function. The teacher may advertise a course on Excel. However, there is a exchange taking place. The teacher gives me a lesson that solves my problem and in return, I allow him to advertise his products to me. The lesson isn’t just marketing or brainwashing that is disguised as teaching.
However, the way things tend to work in a lot of the business world is “profits come first”. This is especially the case when more than one person is involved in a business.
Whenever you see someone online, who is selling something, you need to see them as a ceo of a company or a salesman, rather than a person, who you might meet in a standard social setting. They try to get you to believe that you are a friend. I saw one guru, who even compared his followers to his children in a video. He said, “You are my children”. I’ve heard that cult leaders call their followers “their children” as well.
Anyway, that’s all for this video. Take care and Good luck!
References
Farrington, Jeanne. (2011). Seven plus or minus two. Performance Improvement Quarterly. 23. 113 – 116. 10.1002/piq.20099.
Chague, Fernando & De-Losso, Rodrigo & Giovannetti, Bruno. (2019). Day Trading for a Living?. 10.2139/ssrn.3423101.
Hasher, Lynn; Goldstein, David; Toppino, Thomas (1977). “Frequency and the conference of referential validity” (PDF). Journal of Verbal Learning and Verbal Behavior. 16 (1): 107–112. doi:10.1016/S0022-5371(77)80012-1. Archived from the original on 2016-05-15.
Miller, G.A. (1956) The Magical Number Seven, Plus or Minus Two: Some Limits on our Capacity for Processing Information. First published in Psychological Review, 63, 81-97.