Investing & Online Stock Trading – The Most Expensive Education Possible – Education Future

To date, in our newsletter we have mainly concentrated on trading stocks and Exchange Traded Funds. We understand that some of our members also trade derivatives such as options, warrants and CFD’s.We consider these to be the domain of experienced traders only, particularly as they are leveraged products which work both ways – they have the potential to magnify losses as well as gains.We suggest that traders should learn how to successfully trade stocks profitably for a few years first – to master their skills in analysis, money and risk management – before you consider trading leveraged products.It was with great concern that we received the following from one CFD trader this week:”Hi,I have decided to stop trading for 6 months due to “blowing out” my CFD trading account through some poor position sizing and risk management. Nothing I couldn’t afford to lose, but I can’t afford to lose any more.As such – I wish to remove all possible trading distractions and hence I request to cancel my subscription as per your one month notice policy. I liked the newsletter and was considering signing up for Boot Camp, but I am afraid I no longer have the funds to trade and really need to reset.I can see now why CFD’s are not much better than poker machines for those people who understand the odds against putting hundreds of dollars into a poker machine and don’t play them. (Like myself)CFD’s seemed like a good way to trade on a small account ($5K), but the ease of trading, the commissions on trades (I spent $1000 on commissions when I totalled it all up last week – 20% of my account), the large share parcels on small stop/losses, slippage from gaps all contributed.The major factor though was some false confidence that I thought I knew what the market was going to do next and so what I thought was trading was probably more punting. In addition, some seminars, trading books, newsletters and software packages added another $5K to the losing experience.I have decided to step away from trading for 6 months (I have to – my wife won’t give me any more of our holiday savings at the moment) – save some capital and re-launch with some education… I will keep an eye out on your web site for the next Boot Camp later in the year.I will contact you in the future and perhaps re-launch my trading with one of your Camps.Thanks and regardsJohn MPS Thanks again for your interest which I do appreciate – you are no doubt extremely busy… to take the time to personally respond for a $30/mth subscription cancellation email has been one of the positives in my current trading career to date. I look forward to joining you again in the future.PPS There may be an idea there for an article for your newsletter about the challenges for new traders, psychology and CFD’s….The stock market can provide the most expensive education possible.Its times like these that traders have to make the decision to quit and walk away completely …….. or pull themselves away from physically trading, consider what they did, what lessons they learnt, then very importantly seek out the education to put themselves back on track .As we have shown in our newsletter, through the work of Dr Brett Steenbarger, Brian McAboy and Catherine Taylor, the subject of trading psychology is a cornerstone to trading and investing success. Over the past year we have particularly come to appreciate the coaching work of Catherine in helping traders around the world understand themselves better, set goals and strive to achieve more.Following up on John’s suggestion for an article about the “….. challenges for new traders, psychology and CFD’s”, we invited Catherine to comment on John’s situation from her perspective. We thank her for her reply:Dear JohnOuch! My heart hurt when I read your story. It reminded me of two famous quotes:”Men are disturbed not by things that happen, but by their opinions of the things that happen.” Epictetus (55-135) and”Failure is the opportunity to begin again more intelligently.” Henry FordIt’s painful to see someone withdraw from trading or any game due to some poor decisions and lack of knowledge.The way I see it is if you could actually attend Boot Camp and stay with the newsletter, you could not only turn your trading around with time, but also your esteem, confidence and life in general.The following is from Robert Kiyosaki, who literally slept in his car after his first business failed and before he wrote his best selling book ‘Rich Dad, Poor Dad’:”Most people choose not to be rich. For 90% of the population, being rich is ‘too much of a hassle.’So they invent sayings that go, ‘I’m not interested in money.’ Or ‘I don’t have to worry, I’m still young.’ Or ‘When I make money, then I’ll think about my future.’ Or ‘My husband/wife handles the finances.’The problem with those statements is they rob the person who chooses to think such thoughts of two things: one is time, which is your most precious asset, and two is learning.Just because you have no money, it should not be an excuse not to learn. But that is the choice we make daily, the choice of what we do with our time, our money and what we put in our heads. That is the power of choice. All of us have choice. I just choose to be rich, and I make that choice every day.INVEST FIRST IN EDUCATION. In reality, the only asset you have is your mind, the most powerful tool we have dominion over.”I think you have to admit Robert has got a great point there. I have personally worked with Robert and I know he has an insatiable appetite for knowledge. Knowledge is fundamental to winning in any game. By allowing yourself the opportunity to attain more knowledge, you then have the opportunity of turning your game of trading around.Success is the goal of any trader in the market with visions of increased income, ever increasing capital and a lifestyle to their making.By definition, success is the condition or fact of achieving the desired objective. It’s purely about achieving your target, objective or intention. Success is an extremely personal state of being.When you started out trading, you had a target that you wanted to reach, It was your personal goal. Okay, so on this occasion you have experienced the opposite to success, a ‘learning experience’ that unfortunately is more frequently labelled failure.Congratulations! Why? Because you have discovered what didn’t work and therein lays a pot of gold. Your ‘learning experience’ is something of incredible value. Embrace it!Failure is often the doorway to success – dependent upon what you do with it. Ceasing to trade is admirable and I really acknowledge your action of no longer trading and taking the time to reset at this point in time.Total withdrawal does not support you nor get you any closer to fulfilling your original intention.Most of us withdraw from an area after a learning experience because contact with the area that we didn’t achieve success in (be it trading, relationships, business or health goals to name a few) causes us pain and discomfort.The more Present we are with something or someone, the closer we are to it. The more withdrawn or Absent, the further away we get. After a learning experience it is paramount we draw closer to the area, embrace it, get really Present – be there!Why? So you can extract a wealth of wisdom, correct on and add to some of your existing knowledge.Use your innate resilience to be Present and capitalise on what you have already spent in losses, commissions, courses and software plus the time, energy and attention that you have invested to date.You have already started on laying a foundation and now that foundation just needs some work. Continue to invest in yourself and your education.And finally, here’s another secret that all the successful people I have worked with have as part of their fundamental philosophy; take on the mindset of an apprentice.
Acknowledge that there is much to learn, much that you don’t know. Allow yourself to make mistakes – manage your risk and grant yourself the time necessary to work toward a level of mastery.Here is to your capitalising on your knowledge and learning experiences to date. I wish you every success John, both in your trading and personally.Best regardsCatherine Taylor

How Globalization Affects Accounting Education – Education Future

Globalization is becoming increasing more prevalent in today’s society. Not only are individual firms across the United States becoming more connected and developing similar ways of communication, but it is occurring across the world. For accounting and education, this has a huge impact, especially in the United States. The United States accounting standards are different from the entire world. However, students today need to know both processes in order to be successful in international relations with accounting. Globalization has a tremendous impact on what students are being taught and what they need to know.Many accounting majors in college will graduate and enter in to public accounting jobs. The United States is the only country which uses Generally Accepted Accounting Principles as the method of accounting. This means when students enter into the workforce and deal with clients overseas, they are not using the same accounting practices. Students are not taught all of the fundamentals of IFRS (International Financial Reporting Standards) as well as GAAP (Generally Accepted Accounting Principles). There is too much content and not enough time for students to learn both methods which leaves them at a disadvantage as they enter the workforce.Rules are consistently being changed as the FASB is trying to converge to similar standards as IFRS. For example, GAAP recently did away with extraordinary items, which is something that IFRS does not contain.The changes of these standards are making accounting education more complex but also help the students to develop a better understanding of accounting as a whole across the world. Accounting education is evolving and adapting daily to take into account the globalization of accounting. Students are being taught what it means to do accounting and learning why GAAP has different treatment of items than IFRS. The globalization of accounting is allowing students to think deeper into the financial statements and understand why items are put on certain lines and develop their own thoughts. As Belverd Needles, Jr. states, “When explaining a principle-based requirement the educator can build from the objective of financial reporting through the concepts set out in the Framework to the principle in a particular IFRS and explain how ‘good’ rules (e.g. application guidance) give effect to the principle. When a requirement is not based on the Framework, the educator could provide reasons why the standard-setter deviated from the Framework. Educators could also teach students to make accounting judgments and discuss areas of judgment in each IFRS (Needles Jr.).” Students are learning about the biggest differences and developing a real understanding for the accounting behind them. This will be a significant when they enter the workforce and have to make accounting decisions without having a textbook telling them the correct way to approach it.The topic of convergence has been a big one in accounting education. If the United States eventually makes a decision to converge from US GAAP to IFRS, this would change the entire curriculum which students are learning today. It is very important for students who are learning the basic accounting principles today to understand the primary differences and the advantages or disadvantages of converging. This is where globalization plays a key role because with the increase in technology today, we are becoming an extremely globalized world with companies who have offices in almost every country of the world. A speaker of the SEC does an excellent job explaining what convergence means, and why it is beneficial, “In the long-term, this definition of convergence is a laudable one to which all should aspire so that a single set of high-quality accounting standards could be used by all preparers. And, more important to the SEC, whose duty is to take the steps necessary to protect investors, a single set of high-quality accounting standards applied even-handedly greatly reduces uncertainty about comparability of published accounts, thereby greatly enhancing the transparency of information to the market place (Herdman).” As Mr. Herdman explains above, convergence would allow investors all over the world to be able to compare financial statements and simply line items which would help them to develop a better understanding of the organizations around the world.Finally, what does this really mean to students who are majoring in accounting today? An assistant professor at University of Arkansas posts on the AICPA website and gives an idea of what changes are ahead for accounting students:… today, as I look ahead 30 years into the future, there are some tough problems facing higher education and we are on everybody’s list of industries expected to undergo some major changes during the next decade… Additional possible changes include:• New curriculum models that reflect the big data, global environment.• New forms of education delivery, such as massively open online courses that reach tens of thousands of students at once and have 24-7 help available.• New forms of assessment with less emphasis on time spent in coursework and more emphasis on what was mastered. (Karen V. Pincus)The changes mentioned above describe not only technology, which plays a huge part in globalization, but the changes in accounting and how this will change education drastically. Globalization is a good thing for accounting education and will help students and future business leaders to develop with a broader understanding of accounting across the world.Works Cited
Herdman, Robert K. “Speech by SEC Staff.” 18 April 2002. Securities and Exchange Commission. Print. 1 March 2015.
Karen V. Pincus, PhD, CPA, Doyle Z. and Maynette Derr Williams. “What does the future of accounting education hold?” 14 August 2013. AICPA Insights. Web. 1 March 2015.
Needles Jr., Belverd E. “Accounting Education: The Impact of Globalization.” Accounting Education: an international journal (2010): 601-605. Web.