Quote from Zen Student:
Your emotions are likely just fine if they are. If you have emotional issues, you need to work on these prior to trading but this is a separate product. The story of not being able to follow ones' trading plan is a story told and retold here on ET. If you took the majority belief here as gospel you might think that this applied to every trader. I can assure you that there are those, not few in number, who had zero or close to zero "emotional" problems executing a strategy which they had developed and understood.
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If you are insufficiently cool and calm to execute live trading then this is probably not for you. I think there are indeed factors of the personality which are difficult or very difficult to retrain, and the source of the problem may not be fully understood. Don't worry about it. You can hire an execution specialist if you come up with a cracker but cannot trade it. There are other options. No need to start dicking around to see how your so called emotions hold up under haphazard uninformed gambling.
Clearly Zen Student knows what he is talking about, but I disagree with his viewpoint on the emotional side of trading.
Trading inevitably means acting upon imperfect information and taking uncertain amounts of risk. It doesn't matter how quantitative your model is, or how robust your results are. Unless you can automate the actual execution of the trades (doubtful), the emotional element matters. Even if you can stay perfectly disciplined (adhering to stops, etc), psychology comes into play in at least 2 ways:
1) Trading is stressful. You might have a system that reliably wins 60% of the time, and is thus profitable in the long run, but the bumps and bruises along the way might be too much to handle. If market conditions change for a sustained period, you might lose confidence in your model.
2) Trading can be tedious. If you've reached the point where you're eking out a living exploiting some marginal inefficiency, the whole enterprise can start to seem shallow and dull. It risks becoming a chore, not unlike your dreaded consulting career.
Clearly trading isn't for everyone, but different aspects of trading appeal to different people. Personally, I get the most enjoyment out of finding an edge and besting the competition. It's the discovery of a profitable trade/algorithm that gets me going. But even though I'm genuinely passionate about the markets, I'm still susceptible to points 1) and 2) from above. The OP has barely entered the idea-generating stage. He thinks he's passionate but until he starts using real money and going through the motions of trading for a living, he won't know if he can handle it psychologically. It is rarely as simple as 'discover edge->profit->lever up->profit more'.
I'm not, however, suggesting he start live trading before he's found an edge. I'm just doing justice to the point that emotions DO come into play. To the OP: how do you feel about playing poker? Does grinding out a profit for 14 hours straight in a vegas casino playing limit hold 'em sound enthralling? The skills and temperament of a successful poker player translate surprisingly well to the realm of trading.
