Why some individuals are better traders than others?

[robster970]

I admit I actually let a few drops go myself...

Thanks Hilary and DT - it seemed like the right thing to say.......😆

 

[maxima]

I admit I actually let a few drops go myself...

robster-dropster ? 😆

 

[roughbert]

1. What does it take, fundamentally, to be a successful trader?

As with all forms of hunting, knowledge of and respect for one's prey.

 

[rawrschach]

Why do my farts smell better than everyone else's?

 

[meanreversion]

If you know EXACTLY what it is that makes people trade well or poorly, then you're half way to becoming a good trader yourself. Given there are so few successful traders, you're unlikely to find the answers in a couple of sentences.

Early on in "Way of the Turtle" there is a section on cognitive biases - this will help you with your project.

 

[MrGecko]

I stil think you should change your dissertation title. Think about it - the title of your study requires you to:

* define what a trader is
* define what a good one is
* collect information from the good/non-good sample
* compare and contrast

 

[arabianights]

Why do my farts smell better than everyone else's?

cause you eat whale flesh.... and kittens

 

[maxima]

cause you eat whale flesh.... and kittens

no no no no... lets first

$ define what an ar.se is
$ define what a fart is
$ collect samples
$ compare and analyze them thoughtfuly

 

[Black Swan]

Here is my humble opinion.

What makes someone a great trader is probably the same thing that makes great runners, physicists, astronauts, soccer players, painters, sculpters...

Now - I couldn't fill Linford Christie's shoes (or shorts to be honest) and I'll never be able to but I could certainly train to be a better sprinter.

What makes a great trader ? Probably natural talent.
What makes a profitable trader ? Probably less natural talent and more perseverence.
What makes a terrible trader ? Again - probably inbuilt attributes that work against them.

Some people will be fantastic with little relative effort.
Some will be OK with a lot of work.
Some will be crap regardless of what they do.

D'ya want to take a stab at defining what is "natural talent" for a trader...? 🙂

 

[DionysusToast]

BS - how do you define natural talent for a skateboarder ?

How do you define natural talent for an Ice skater, runner, high jumper, salesman, pole smoker etc ?

Some things just can't be broken down other than 'they just are'...

 

[meanreversion]

D'ya want to take a stab at defining what is "natural talent" for a trader...? 🙂

80% of the job postings for hedge funds and prop shops these days are either

a) PhD statisticians/quants
b) programmers

It's tough to imagine these people having a "natural talent" for trading..

 

[arabianights]

Now I know why you don't answer the phone.

I wouldn't actually call that giving birth although I admit a superficial resemblance

 

[meanreversion]

With all these insightful comments, I'm amazed Claire hasn't commented since the opening post.

Maybe her REAL dissertation is "all traders are a bunch of chauvinistic and immature men" ..

We passed with flying colours!

 

[forker]

D'ya want to take a stab at defining what is "natural talent" for a trader...? 🙂

At least 14 inches of Xfactor stud...

 

[DionysusToast]

With all these insightful comments, I'm amazed Claire hasn't commented since the opening post.
!

Her parents have been in touch.

She has been kidnapped. They just got the ransom note in the post.

Bizarrely, the note was attached to a close-to-death rodent.

We have no idea who would do such a thing.

 

[FX Bandit]

I am a final year student at the University of Gloucestershire, investigating for my dissertation why it is that some individuals are more successful traders than others.
I would really appreciate if you could take a few minutes to answer these questions; the more in depth the better as this helps my analysis. All answers will be treated in confidence.

1) What does it take, fundamentally, to be a successful trader?
2) If it is the case that some people are simply unable to be successful traders, why is this?
(Please note that one is not necessarily the opposite of the other).

There's a University of Gloucestershire?

 

[wackypete2]

Some things just can't be broken down other than 'they just are'...

Very surprised to see this from you considering all the "proof" you seem to want that t/a or S&R lines, fibs, etc actually work. The same answer you give above doesn't seem to work when given to you.

Not trying to stir the pot actually, just an observation. I was surprised by that.

Peter

 

[DionysusToast]

Very surprised to see this from you considering all the "proof" you seem to want that t/a or S&R lines, fibs, etc actually work. The same answer you give above doesn't seem to work when given to you.

Not trying to stir the pot actually, just an observation. I was surprised by that.

Peter

In terms of the belief in mathematical solutions to the market, indicators, magic bullets, EAs & other assorted nonsense - yes, I would like just one time for someone to bring non-anecdotal evidence that they work.

If you are ascribing properties to an indicator which has a mathematical base and saying it has an edge, it would be VERY simple to prove, yet no-one can do it scientifically. They just come up with all sorts of nonsense like "it takes a year to learn an indicator", "I can't reveal my edge", "it doesn't work alone, just with other stuff". I mean seriously - can someone not just pick 1 indicator and show it will assist trading better than a coin toss ?

On the other hand, the research I did showed me that they were no better than random entries, hence my confidence in their nonsense. As an aside - I have worked extensively on forecasting/planning algorithms in the past for some reasonably large manufacturers (DELL, Ericsson, Fujitsu), so I do have the tools & know how to test this kind of thing. I AM a geek, I just don't think geeky things work in trading as much as I wish they did.

In terms of 'talent' - this is pretty much in line with the above. I do not think that science will ever resolve trading in terms of predicting direction. It is more of an art, a skill - especially when it comes to day trading.

Now - if you throw me an egg from any distance, I can catch it and not break it - this is very easy for me. On the other hand, I have played 'egg catch' with a lot of eggy people - they just can't seem to do it. It comes naturally to me, it doesn't come naturally to other people.

Schumaker is a great driver. I am a driver. I will never be as good as Schumaker. He has talent. This talent cannot be described mathematically. In fact, I doubt even psychologists/biologists/genetecists (sp?) could isolate the talent.

People try to quantify price action. People want "If... then... do this... else.. do this...", especially those with a background in engineering. Trading just isn't like that in my experience.

So - we now find ourselves attempting to quantify trading skills/talent as well. I am sure at this point, it is clear what I think about that...

 

[meanreversion]

I spent several months testing many of the more popular indicators, e.g. MACD, RSI, stochastics, even Bollinger bands, and didn't find them to be of much use. That's not to say they can't be used, but I didn't uncover anything mechanical which was consistently profitable in a meaningful way.

I'm sure many people use them quite happily with a discretionary overlay. Or maybe they don't, seeing as how few traders make money.

 

[MrGecko]

In my view, Indicators and the like don't necessarly introduce a positive OR negative aspect to any trading strategy; the problem is that indicators act as an incubator for new traders to develop "thinking errors" in their trading strategy, which become a tough habit to break out of.