Having interviewed many of the greatest ever traders over many years in his Market Wizard series, many of whom expressed the important role personality plays in trading, Jack Schwager dedicated an entire chapter to the subject in his latest offering ‘The Little Book Of Market Wizards’, and even went so far as to say “if you get nothing else out of reading this book than the one following principle, it will still have been a very worthwhile endeavor: Successful traders find a methodology that fits their personality.”
To illustrate his point he contrasted the frenetic style of Paul Tudor Jones with that of the studious Gil Blake, but perhaps the simple yet profound contribution from Colm O’Shea was what stood out the most, as Schwager surmised here:-
“Traders must find a methodology that fits their own beliefs and talents. A sound methodology that is very successful for one trader can be a poor fit and a losing strategy for another trader. Colm O’Shea, one of the global macro managers I interviewed, lucidly expressed this concept in answer to the question of whether trading skill could be taught: ‘If I try to teach you what I do, you will fail because you are not me. If you hang around me, you will observe what I do, and you may pick up some good habits. But there are a lot of things you will want to do differently. A good friend of mine, who sat next to me for several years, is now managing lots of money at another hedge fund and doing very well. But he is not the same as me. What he learned was not to become me. He became something else. He became him.’”
I could list at least a dozen other quotes from notable traders who have recognized the role of personality and expressed similar findings, but I think it’s fair to say most people who have been in markets either trading or managing money for any length of time have come to realize this as being self-evident, and very often reached that conclusion the hard way. But when relaying this kind of information to newer traders, the responses I often see are along the lines of: “Everyone says that and I accept it to be true, but no-one ever tells you specifically how to do it. How do you find out exactly what your personality is and what trading styles or methods suit it?”
It’s a great question, and the fact that it can take successful traders many years of trial and error to discover what really works for them, I think demonstrates there perhaps hasn’t been a straightforward answer, until now that is, as I recently discovered.
This week I visited another trader in London. He was kind enough to host me for a few days and helped me meet other traders both retail and bigger players from the prop world. Here are a few things I’ve observed from that trip. Continue reading “A frog in London, tales from the trading world”
Man, i wish could have attended this class. Below are excerpts from Mike Bellafiore’s posts following the class. Continue reading “SMB Capital’s Mike Bellafiore on Dr. Brett Steenbarger’s Master Class”
2016 has come to an end. It’s time to review the results, and the processes.
I’ve wrote this in a private forum. The discussion was about traders who have been studying for years but are stuck running in circles. It kind of pissed me off so i decided to be brutal. Continue reading “How to reach the next step in your trading”
I funded my first live account one year ago, knowing i wasn’t ready yet. Let’s review what happened since then, where i’m at now and what the next step is.
I realize i haven’t posted in here in months. Many things happened since the last post. Please find below random observations, thoughts i’ve had since then.
- I went on a ski trip in February. I was on a roll before. Spotted setups on my phone during the trip but abstained from trading them. What i wasn’t prepared for was the comeback. It took me weeks to get back in the game. Barely. I couldn’t read the market at all, and thus was frustrated for not taking advantage of opportunities when they were there. I know i shouldn’t be that emotional to missed opportunities and that it shows my youth in the game. I may be lying to myself but i think all accomplished traders went through that stage at one point in their development. It probably takes more time when you’re on your own at home than when you’re in a bank, hedge fund, prop firm, with experienced people to coach you. In any case, we’re in june now, and I haven’t reached that level of synchronicity with the market since then.
- If there’s one thing i learnt, is that the trader is the edge, not the strategy. The more i know about the market doesn’t implicate more money in my account. It’s not the opposite either, obviously, but the correlation is very low. Of course having more knowledge (market structure, time and price, etc) helps, but it such a ridiculous part of what’s necessary. It’s not even close to having control over yourself. And don’t forget money management either.
To say that i’m unsatisfied with my trading week would be an understatement. While i didn’t lose money, i didn’t make any either. In fact, i didn’t place a single trade despite the numerous opportunities offered by the market this week. Some i had identified in advance but didn’t capitalize on, some i didn’t see at the time, only after the fact, mostly because i was doing something else at the same time. A study of my diary shows that i can only blame myself and not, say social media, which is both a blessing and a curse (more on that later). I’m clearly going through the phases of a developing trader. And since it’s been a while since i’ve written on this blog, i’d like to take this opportunity to show where i’m at.
Continue reading “20160131 Trading Journal entry”