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Most people who trade in the stock market don't have that much experience with trading systems of any kind. For both the beginner and experienced trader alike, employing some kind of system can help you become a better trader. Simply watching what comes out and studying the chart patterns can be a great exercise to learn more about trading. Find some reviews of trading systems on the web, and find a few that look promising. A good place to start is Google Search, or Yahoo. Keep a logbook of ideas you like, track what they do in the next 20 or 30 minutes (or even to the end of the day) to get a feel for how its working. Given some time, you will be able to go back through your notes and then see if the information is good or not. It will also focus your attention and skills at finding good trading ideas.

It is also key to note the ones you are passing on (meaning you dont like the idea, or it seems like it is no good). Often times those can be a real key to improving on your chart reading skills if you notice a pattern of behavior where the stock picks that you dont like end up moving far more than your top picks. So its always a good idea to track both, if you have time, or especially if you notice the ones you are watching dont work while the ones you are ignoring seem to be working. This is also where a review site can help, as usually they summarize what each type of trading system can do and can't do, which narrows down the amount of things you need to watch. So instead of 7 types of tools or trading systems to look over, you might narrow it down to 3, and the tracking of ideas becomes much easier.

When this happens, you need to pull up some charts from stocks you are tracking and figure out if the ideas you are picking out are off because of current, short term market conditions, or is it because of some other underlying reason. A lot of times its the latter - ideas are chosen because they "appear" less risky, when in reality those are the ones that actually work the best. Its a perception problem at this point, and once you can figure out the issue, its easy to start working on a solution to make yourself a better trader. Usually this starts happening when a trader starts overly concentrating on not losing, rather than picking something that can be a decent winner. This is a slight distinction, but it really can effect overall results.

Obviously this is not the end all solution, but doing stuff like this can help yourself become a better trader. The goal is to try to find some tools that not only feed some decent ideas, but at the same time you become better at trading, price targeting, and stop placement.

Almost everyone that has an online account these days has access to live charting and tools (indicators). This is provided by the trading firm/brokerage for 2 distinct reasons. The first is a competitive one. Others are providing it, so if their tool is lacking, it might be a deterrent to actually getting new accounts. This much is true, and is the backbone of competition in our economy -- net net the consumer wins (well, most of the time). The second, and in my opinion the more nefarious reason, is to "educate" the customer so they trade more. Since the first reason is boring, we will explore this second reason in a bit of detail.

Why do I say its "nefarious?" -- easy, the brokerages know that 90% of their customers (or more) are by no means professional investors, or even close. Most have an adequate knowledge of how the market works, and may do 2 -3 trades a month. What they want is the most trades possible from every customer every day, unsolicited. By this I mean they are not pumping you with email recommendations, phone calls, or the such. They want you to have just enough knowledge that you are dangerous. Yep, thats right, they want you emboldend and sure of your prowess so you trade more. Even doubling that 2-3 trades a month to 5-6 is huge for them, if you consider they have millions of accounts.

This also will cause customers to order books from amazon and other places on the stock market and trading, attend seminars, and utilize other tools to assist them. Now none of this is bad, as education cannot hurt. However the stock market is a pretty brutal place to "test" ideas as you have to bet with real money. In addition 2 or 3 trades does not make or break anything you might have learned. No - it takes 100-200+ trades to see if its worth any merit, assuming it is not a stinker and just loses on every try. In this case you are an idiot if you do that 200 times. I will assume no one reading this falls into that category :)

However in reality, no matter the tool, book, seminar, or newsletter, it will take at least 20 trades to really see if there is any merit to any method of picking stocks. In addition, you have to account for market conditions. What I mean by this is if your method is picking only stocks to go up (long picks) and the market is in the midst of a 2 month 20% gain runup, you have to discount the results as most likely a dart throwing method might do just as good considering the conditions of the market.

Whether its someone else's pick, or something you found by using the tools provided by your brokerage that you think works, the main key is consistency of behavior for both the method AND the person using the method. Its human nature (I have been guilty also of this) to have something that works decent and when it has a string of not working, try to mess with it, tweak it, change the rules etc so that it works in the current market. This game never ends. Just when you get it, the market will shift again slightly so you are again down the same path. Ignore perfection, it does not exist. If you can find something or someone who can give you decent ideas even 50% of the time, with money management you have a winner most of the time.

Now earlier when I said nefarious, I meant that the brokerage firms know that most of the people will never learn to be proficient, BUT exposing them to information and giving them education sets them on the path to learning. This leads to more trading. They will never acknowledge this fact because in the beginning most who go down this path lose a decent amount of money in the "learning process". The end result is not all bad though. As long as you control your urge to act on unproven ideas (you can always paper trade and track ideas) and really really find and adhere to proper money management techniques, everyone can become a better trader. Even longer term investors can benefit, as it starts the thinking going about what your strategies and goals are.