Correlation...

Quote from Juggernautica:

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That said, a TRULY HIGH PERFORMING athlete, in my view, is FAR MORE LIKELY to succeed at trading than your average smart joe.

Here are a few reasons:

1) high performing athletes are generally disciplined and understand that practice/work directly correlates with performance
2) athletes know that ONLY RESULTS matters .. they may be less likely to engage in self-defeating, overthinking. rationalizations.
3) a high performing athlete is more likely to use visualization techniques and subconscious programming techniques that can greatly assist in controlling emotional trading
4) a high performing athlete will likely have a higher self-expectation that will resultingly produce greater focus, work, and persistence
5) a high performing athlete is more likely to INTUITIVELY utilize modeling techniques that faciliate rapid mastery in any subject
6) A high performing athlete MAY have more money they can lose in the markets, while getting their skills up to speed. :-)

People like Lance Armstrong, Tiger Woods, and Michael Jordan.. absolutely.. they would definitely have a better chance of succeeding than even more intelligent counterparts. since trading requires diligence, healthy competitiveness, and great mental discipline, 3 traits high-performing athletes ALWAYS have.

But to keep this in perspective.. they may have a 20% chance of succeeding, while others have a 5%.

-Jason
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I've never heard of any actual statistical study research...

Therefore I don't know how close or far away you are with the 20% to 5% stats...

Yet...I completely agree with everything else above.

Thus, I'm sure of all the traders that are profitable and making a living at it...

if you compare their backgrounds...

a higher percentage of them in comparison to other traders backgrounds must have either excelled or participated in sports far beyond the typical high school jock stuff.

The above is only a guess and the only facts I can use is my friends (a few are either close online pals, college friends or trading pals from an old software user group).

Of those that are succeeding in trading...5 out of a dozen or so...excelled in sports.

One a former NCAA rowing star.

One a former NCAA two time all american in wrestling.

One a former high school track star and a current sports psychologist.

One a former high school football star that played college football for 2 years before blowing out his knee (ended his football career).

One a high school cross country varsity letter...she currently does marathons but doesn't excel at marathons.

The others didn't play sports seriously and a few are anti-jock...although their former or current career backgrounds required a lot of discipline and quick decisions.

My point is this...I don't think for a trader to succeed they must have excelled in sports...

no way.

Something else...most athletic stars aren't born that way. Most had to train hard, develop those skills (techniques) and bust their butts to win those championships.

Many were very technical in their approach to their sporting events...

still are while playing sports years past their glory days...

For example...the former rowing star is a pretty darn good outdoor volleyball player...him and his partner compete frequently in tournaments although they don't excel at it.

Yet, he takes volleyball very seriously and practices religiously prior to any tournament events.

Simply...often...skill will overcome genetic ability when involved in sports.

However...I do think that for a trader to succeed they must have been trained and/or excelled in something prior...that required discipline, quick decisions, objectivity while in the most stressful situations, ability to handle pressure, controlling emotions and so on...

this would explain why a clumsy former surgeon that couldn't make one free throw out of 500 attempts would have as good of a chance or more of a chance at succeeding at trading...

in comparison to a trader that freaks out and allows one trading day to wipe out gains for an entire month.

NihabaAshi
 
I have heard stories of ex-athletes being recruited as traders. Not necessarily pro athletes either, big time college football players also.

who would you pick to be your brand new wet behind the ears floor trader:

A. a newly minted Phd. in statistics. Very smart, but also nerdy and nervous, and who doesn't have a lot of respect for non-intellectuals.

B. The quarterback of the NCAA division I football champions who won the game in the last second by throwing a perfect pass through two defenders while playing with a fractured ankle. He isn't all that smart, but he has common sense and can do basic math and stats ( which he is familiar with through sports), and will do whatever his coach tells him to do.

That choice is pretty clear I think.

I would hire the phd. to be an analyst, but I would hire the ex-athlete to be the trader, no question.
 
At least on the floor of the CBOT, there are a grossly disproportionate number of former pro and college atheletes in the pits, and a number of firms recruit former college atheletes as trader trainees. The reasons are a competitive nature combined with a very high level of personal discipline. They are especially sought out by some of the arb firms that use a trading team approach, as they are used to that decision-making model as well.
Jessie
 
Quote from dotslashfuture:

I would hire the phd. to be an analyst, but I would hire the ex-athlete to be the trader, no question.
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There's definately a place for both.
 
Quote from dgmodel:

do you feel that ppl who succeed in sports tend to succeed in trading/business??? or the two have lil to any correlation???
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If the correlation is true Carl Lewis should be a top trader and Larry Williams an Olympic champion. :confused: :confused: :confused:
 
Quote from enrick71:




If the correlation is true Carl Lewis should be a top trader and Larry Williams an Olympic champion. :confused: :confused: :confused:
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I think what was trying to be said was that serious athletes or those in prior careers that required discipline and quick decisions in very stressful environments...

and were able to succeed at such...

have a better chance of having more trading success than those that have not been previously in the above situations.

Simply...maybe Larry Williams was in a prior career regardless if he was a high school star, collegiate star or a paramedic.

That's my interpretation so far.

Heck...maybe Larry Williams is a 2nd degree black belt in Karate...who knows.

Such would require a lot of discpline (2nd degree black belt)...right?

Simply...you don't need to be an Olympic Athlete to analyze if there's any correlation between top athletes and top traders.

Someone once told me...

Lazy traders don't succeed.

The same is true for athletes.

P.S. Have a good trading day all and don't forget to warm up and then stretch those muscles prior to your first trade :cool:

NihabaAshi
 
Well, I think you could figure out if that correlation is true by digging out the three volumes of Schwager's work on trader's interviews and find out who was a top athlete. I think the sample size is fairly decent.
You will find out that most weren't into sports all that much and that Seykota was a MIT grad who didn't have any problems with nervousness.

Bottomline, I think the correlation isn't there.
 
There is the old saying in research that correlation doesn't equal causation. Just because someone is a good athelete doesn't mean that they will be a good trader, nor does it mean that they won't, just as the fact that someone wasn't an athelete certainly doesn't preclude them from being a great trader. I think that the role of athletics in trading has little to do with physical characteristics or the specifics of athletics, and a better question might be "Do people who have worked in fields that require rapid decision making under pressure, extreme discipline, superb preparation, and great, sustained effort at learning their craft make better traders?" Those are the characteristics of serious atheletes, those who excel in business and other disciplines, as well as of good traders. Many businesses, both trading and otherwise, also look to hire former military officers, especially service academy grads, for exactly the same reasons and characteristics. Some of us learn those lessons first on the field, some of us in the pits, but they are in many ways the same lessons.
Jessie
Actually, if I remember correctly, many of the "Market Wizards" were serious atheletes. I believe Monroe Trout was captain of the Princeton basketball team, and offered a pro contract, Niederhoffer was a world class squash player, and there were others as well.
 
Quote from jessie:

At least on the floor of the CBOT, there are a grossly disproportionate number of former pro and college atheletes in the pits, and a number of firms recruit former college atheletes as trader trainees. The reasons are a competitive nature combined with a very high level of personal discipline. They are especially sought out by some of the arb firms that use a trading team approach, as they are used to that decision-making model as well.
Jessie
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Same on the Merc .... floor trading operations - arb etc - were a very physical, and team oriented business. Floor operations were very much dependent upon disciplined cool heads. Training for any sport requires similar attributes with the ability to execute under pressure.

Today with a lot more off-floor operations, the benefits of hiring disciplined professionals are even more important: A different type of concentration sitting behind the terminal rather than on-floor however. In many ways its a very routine type of activity with hours of quiesscense broken by minutes of chaos in which you must execute, and if you understand this aspect of the business and can deal with it then you are a good match for the profession ....
 
Personally, I think there are a few different categories of "trading athletes", if that is the right expression. First, in the pit physical presence is very important. Thus, it is not surprising that a larger number of recruited traders, clerks, etc have an imposing physical presence, if for no other reason they will get noticed more quickly and presumably have a more aggressive nature as a result of competitive sports. But I also believe that high frequency of trading or pit scalpers behave more as "action/reaction" athletes, similar to basketball, football, baseball, even tennis. Those sports are in a constant flow in which you can use your environment(i.e. the other traders) to trade against.

Screen traders, on the other hand, who have that competitive background in action/reaction sports might suffer from more impatience since they lack that physical environment to garner information and competitiveness. In that sense, I think screen trading is more like golf or a more solitary sport in which you are really competing against yourself in a large sense. Its more like a "bubble" and you have to exercise patience and discipline or you are more prone to overtrading and mistakenly thinking that you are a local, etc, etc...

Basically, I think that the athlete/trader concept is distinctly different for screen vs. pit traders...
 
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