What makes Successful Traders?

Jamie J. said:
Just curious, what can lead to big success in trading? Innate skills, discipline, a wealth of experience, analysts' forecasts, special literature, some tricks or it's just a matter of chance?
More...

Assumption: Big success in trading would be good enough to trade for a living.

1. Learn the basic concepts of trading. Learn to program your mind with the right mindset, and be willing to change the way you think. (difficult) Don't let others distract you from your focus.

2. Paper Trade until you develop a trading system that has a seventy percent positive expectancy over the last 30 trades. (difficult)

3. Having a mentor who actually trades for a living share what they look for and how they find opportunities to trade while you observe. Then, they observe your trades. (Through desk sharing software like Skype (for example)). And then review the trades for adherence to a trading plan. This would be a rare event.

4. I don't believe a trader is good enough to trade for a living unless they can achieve a seventy percent positive expectancy. It's a cut off level that the human psyche needs to feel strong and confident moving forward. There are traders who do well with less expectancy, but they work for a company's trading department. (These traders can't trade for a living)

5. Avoid chat-rooms/forums past learning the basic concepts to trade.
Learn human behavior/emotion from both yourself and by observing others in a chat room(s) environment. (observe how social interaction is the goal, or need for many)

Jeffrey
 
Jamie J. said:
I wonder why special literature is a joke? Doesn't it teach people to make their own strategies and to think correctly?
More...

Books can teach you origami.
But your folded paper shreds itself,
If, unfortunately, left alone into the wild.
You do not think correctly till' the P&L approves.
Did you learn to be a good mother from the books ?
Do you think that books will ever be able to tell the world,
What a mother ought to be ? Do you think it fits into a book ?
Do great artisans have accumulated an outsized libraries ?
How did they learn their craft ? What has more weight ?
Theory ? Practice ? Trial & Errors ? Divination ?
Or is there an archetype of a damned Cook ?
I don't know what make a master trader.
But I expect more scars than books.
Ask a fool what's a great fool ?
The fool is everyone except him.
Ask a wise what's a great wise ?
The wise is everyone if not a great fool.
So great traders know they're are great suckers.
And suckers think they're, of course, GREAT TRADERS.
 
Last edited:
Jeffrey said:
I don't believe a trader is good enough to trade for a living unless they can achieve a seventy percent positive expectancy. It's a cut off level that the human psyche needs to feel strong and confident moving forward. There are traders who do well with less expectancy, but they work for a company's trading department
More...

It's all about the ratios. I'll take 1:3 at 50% over 1:1 at 75%
 
Some of the guys who make money out of trading do it by selling them stuff. Nothing has changed since the 49ers bought their picks and shovels at the store.
 
Jamie J. said:
Just curious, what can lead to big success in trading? Innate skills, discipline, a wealth of experience, analysts' forecasts, special literature, some tricks or it's just a matter of chance?
More...

- Willing to win
- Responsible
- Self-confidence in his method/process... but no ego
- Self-control and aware of his weaknesses / bad habits
- Hard work
- Patience
- Discipline
- Adaptability
- Good at maths
- No chance... but a bit of luck

Majority doesn't want to follow these criteria. This is against human nature, it is easier to be a loser, lazy, greedy, emotional, impatient, egotist, doubtful, follower etc.

CM
 
From Seth Klarman of Baupost Group:


“Did we ever mention that investing is hard work — painstaking, relentless, and at times confounding? Separating relevant signal from noise can be especially difficult. Endless patience, great discipline, and steely resolve are required. Nothing you do will guarantee success, though you can tilt the odds significantly in your favour by having the right philosophy, mindset, process, team, clients, and culture. Getting those six things right is just about everything.

“Complicating matters further, a successful investor must possess a number of seemingly contradictory qualities. These include the arrogance to act, and act decisively, and the humility to know that you could be wrong. The acuity, flexibility, and willingness to change your mind when you realise you are wrong, and the stubbornness to refuse to do so when you remain justifiably confident in your thesis. The conviction to concentrate your portfolio in your very best ideas, and the common sense to nevertheless diversify your holdings. A healthy scepticism, but not blind contrarianism. A deep respect for the lessons of history balanced by the knowledge that things regularly happen that have never before occurred. And, finally, the integrity to admit mistakes, the fortitude to risk making more of them, and the intellectual honesty not to confuse luck with skill.”

http://www.businessinsider.com.au/seth-klarman-on-what-makes-a-great-investor-2016-1
 
I guess it's mostly about discipline and self-control. I mean, it's not that hard to learn the theory, the basic stuff, but the most important part is how you use your knowledge, and if you keep up to your well-designed and back-tested plan (let's say you have one). So yeah, my bet is discipline.
 
Guys, I'm looking at your posts and I realize that for every person success is achieved in a variety of ways. And the most interesting is that it is unique in its way.
 
Not surprising at all in one way. If everyone agreed, then there would be no trade!

That is why so much front running goes on at the largest institutions IMO.
 
You must log in or register to reply here.
Back
Top