Individuality and trade

In his interview, «Market Wizards» Dr. Van K. Tharp gives a characterization of the trader – the underdog. The common feature of all the losers is a high susceptibility to stress and the inability to protect themselves from stress. They typically negative view of life, they expect the worst, they have a lot of conflicts with their own individuality. They tend to blame others when something goes wrong. This portrait is groundless. If a trader is easily excited and pessimistic at the same time, it can not effectively apply their skills and abilities, does not believe that he could succeed in the long term and remain in the stock trading business. Despite the fact that there is a general idea of who can become a successful trader, scientific papers on this topic is almost unknown.

In many ways the study of the correlation between personality and trading resembles the study of correlation between the test for admission to Master’s (GRE) and successes in teaching a master’s degree. Since not all take the examination for admission to the magistracy, the correlation between the glasses, recruited for testing and further study is relatively low. But if we had the opportunity to undertake a study of randomly selected group of Americans who give the test GRE, and then compare the results of the test with their scores in training, the test could help predict their future successes. The same applies to trading. You can take a random group of 1,000 people and give them 50,000 dollars, allowing the trade. After analyzing the results of their work, we would come to the conclusion that the very personal nature of the impact on the successful work on the exchange. In an ideal experiment, the researcher must give each subject is an equal chance to succeed. However, to implement such an ideal study impossible.

  Интрадей -- Кофе

Therefore, the final study on the relationship of identity and success in trade is unlikely ever to appear, but there are several studies that demonstrate that traits are closely related to trade efficiency. In a recent study, “Finance behavioral Journal argued that the trader’s identity is relevant to its commercial success. Oberlechner in 2004 conducted an experiment with a group of professional traders with a view of what they see the ideal characteristics of the trader in the forex market. As you might guess, the number of ideal characteristics include the discipline and the ability to control emotions. This view differs little from that tells us the typical book on the psychology of trading. It is important to control emotions and firmly in detail developed trading plan. However, other characteristics relevant to success in trade is not always taken into account by the authors of books on the psychology of trading. This ability to process information and soberly judge its relevance. Finally, the most important characteristics koreliruyuschie with commercial success can not be associated with personality – the ability to analyze the market, identify trading opportunities, to judge the current market situation and make correct decisions in the process of closing deals.

Another innovative study was organized by Andrew Lo, Dmitry Repin and Brett Steenbarger in 2005. In this study, traders, who attended a seminar on online commerce, has been asked to undergo a personality test before the training program. Since then, scientists have carried out monitoring of trade, which carried out the subjects, mainly on paper. They identified five major traits, which correlate with success in trading, but as the reference group was small, the correlation between personality traits and success in trade was also small.
Doug Hirschhorn in 2005 conducted an experiment on a group of practicing traders to analyze the correlation between personality traits and success in trade. Personality traits associated with the acquisition of a new openness to experience, correlated with a net profit, but not nearly as much as expected. Most successful traders were less prone to acquire new experience, that is, as it turned out, they had less imagination and creativity than the less successful players. It seemed to me that the more successful traders are more creative and open to the acquisition of new experiences than their less successful colleagues. The results of this study showed that a trader is more important to be more specific and focused on data than on creativity.

  Джеймс Харрис Саймонс / James Harris Simons

Draw a line under the debate about the relationship of character and personality ahead. However, data from previous studies show that the undisciplined traders, full of emotions, may not be able to profit. In general, we can conclude that, although personality traits may play a role in achieving commercial success, just as many ways to him, as there are many types of personality that can succeed as a trader.

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