I used to ride a bike in NYC, it's a coin toss no matter how good and defensive a rider you are. Most motorcyclists underestimate the risks and many of them tend to do poorly in the long run. Fatality rates in the US fluctuate around 20 thousand deaths per million miles of travel. To quote my friend who stopped riding after a few close calls, "there are cheaper ways to commit suicide".
Like everything in life, it's complicated. Best way to think about is from the point of view of a poker player. A good poker player will have a system that determines the odds, but will have to make some discretionary decisions. These decisions are heavily influenced by his psychological state. Trading is very similar.
Let's take a systematic strategy with Sharpe of 2, which is pretty good all things considered. On a day to day basis for most such strategies, it's PnL is indistinguishable from noise. So unless it's an arbitrage of some sort, a trader can never be sure if this just a normal fluctuation or the alpha has died. Making right decisions under these conditions is critical for the long term success (do you scale down? do you shut down completely? do you actually scale up if the strategy is mean-reverting? what should you scaling be to never hit your drawdown triggers? etc). All this is especially true if you're running OPM or employed somewhere, as there is non-zero chance that your investor or employers will not have the patience. So I do all that samurai shit ( https://www.youtube.com/watch?v=3thvXvT_HPQ ) to keep myself upright. Plus, I smoke lots and lots of weed.
But yes, for most traders psychology is not an issue. Alpha first, psychology second.
