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.
Sometimes you come across material that is so good you just want to copy-paste the whole thing. What i’ll do instead is just giving you the link. The core of the post is about what the developing trader should focus on. Hint: it’s not the “setups”.