Are Online Stock Trading Courses Legit, or Snake Oil?

There's certainly a wild array of products and experiences to be had on the cheap, sort of, if you spend enough time trolling group couponing sites.

Most are forgettable, delete-able. What can I say? The endless offers for laser hair removal just don't speak to me personally. As mentioned before too, I won't ever spend money on any mechanic-related deal ever again. (It's a personal choice. You might have better luck.) Some offers too, just aren't that great of a great deal – the prices have been inflated so the discount really doesn't mean much.

There have been one or two recent deals, however, that (for better or worse) stand out among the usual suspects: Online stock trading schools appear to have caught onto the couponing phenomenon, and have started marketing their courses to Canadian consumers, whether they have a presence in Canada or not.

My first reaction was one of disbelief. (You're kidding, right?) That feeling soon gave way to a very healthy dose of skepticism.
The first course I noticed was offered by Ireland-based Academy of Financial Trading. The company wouldn't comment on the course, what it teaches, or how popular their Groupon offering was in Canada.

Moving closer to home, I checked in with Questrade Inc.'s online training affiliate, the Online Trading Academy.

Unlike the online education offerings, the Questrade affiliate teaches students to trade live, in person, in a classroom setting. Their tuition fees are notably different as well - $4,990 for the week-long course, coaching, and follow-up services, compared to the $29 you might pay for access to a course online.

Ron de Appolonia, the company's general manager in Canada, says there's a good chance the online course providers aren't shilling snake oil. "It would depend on what they cover," he says. "Anything that applies to Canadian RSP rules, they would probably be giving you some strategies that are not legal in Canada. But these $30 classes, that's not what they're going to teach you - they're going to teach you some very basic information – how to read a chart, and things like that."

That said, he suggests would-be students be clear about what they're trying to achieve by pursuing an "education" of this sort.

"The market's a bloody expensive place to learn. Every time you buy or sell, you pay your commission, plus you're going to get dinged by your losses. It's a very, very expensive place to learn," he says.

"Be reasonable about what you think you're going to get out of an online class. If you want to save yourself the time of reading a book - a book is $30, the class is $30. Just be reasonable about what you think is going to happen with the information you get in an online class."

The second notion that would-be traders should get over, he says, is the thought there might simply be one secret formula or nugget of wisdom that will turn them into successful online investors. "That secret doesn't exist."



Online trading, he says, is a skill just like any other – it needs to be learned, and then practiced in an environment where students get support.

Interestingly, he says there are more people joining his particular program today, who are not necessarily interested in short-term day trading.

Compared to a few short years ago when 90 per cent of his students were interested in trading the markets, today that number is split more evenly – almost half of those in class now, are looking for alternative ways to manage the rate of return they get on their retirement savings.

"Those people need a significantly different course – one to pick up on a skill. There is a whole gamut of things you need to pick up that you can't get online. It can't even come from a classroom environment on its own," he says. "There's no magic secret somebody is going to give you that will transform you overnight."

"How do you think you're going to make thousands of dollars with a $30 investment online? That's just not realistic."


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Kate McCaffery is a freelance writer, editor and former urbanite, now living somewhere in between the lake, the ski hill and some farmer's cow path. Visit mccaffery.ca/kate2.0/ for more information.