Beware: True Believers, Gamblers, Self-Promoters

Discussion in 'Trading' started by BrightPropGuy, Nov 27, 2006.

  1. Brett Steenbarger lists three types of people who we all come across frequently here at ET, and perhaps need to avoid.

    1) Idiot #1: The True Believer - You've probably encountered at least one of these dolts during your market sojourns. They are the ones who have figured out the answer to the market. Not an answer, mind you. *The* answer. It usually is some kind of numerological or astrological scheme, and it is always a hidden secret. Unfortunately, True Believers don't seem content with keeping their knowledge hidden. They're always after you to "unlock the mysteries" of the market by sharing in their discoveries. A surprising number of True Believers are also True Bears, which means that they're forever predicting the end of the financial universe as we know it. They predicted it in 1980, 1990, 2000, and they're still predicting it. And when the market rallies and proves them wrong? Well, that just means the bubble is getting even bigger and the implosion of the universe will be even more profound. My take on True Believers? This is not investing or trading; it's cultism. And true believers are at the point where they *have* to believe, or they'd come face to face with the awful realization of the utter waste of time and money their beliefs have brought, as the Dow has risen from 775 to over 12,000 within a 25-year period.

    2) Idiot #2: The Gambler - This is the "I'm-giving-up-my-job-to-become-a-trader-because-I-don't-like-working-9-to-5" idiot. Observe that this bottom-dwelling resident of the phylogenetic scale is not giving up his job because he's had success at trading. He's also not giving up his career because he so loves trading that he researches it day or night and has found a winning edge. No, The Gambler doesn't do anything beyond 9-to-5, because what he's after are easy riches, not effort and earned success. He hears that others have been successful (usually from Idiot #3), and he figures, "That means I can do it too". Invariably, the Gambler is attracted to daytrading. Why? It gives him a sense of action, and it justifies his decision to abandon all efforts at productive work. Besides, you can't really explain to your wife and kids why you're not out there with working humanity supporting your household when you're sitting around doing nothing, holding positions for weeks at a time. So the Gambler actively trades in and out of markets, pretends like he’s got a job, and every so often berates his spouse when she wonders when the family will be able to pay its bills. My take on Gamblers? They're not interested in trading; they're interested in their fantasy. So interested that they'll take their bank accounts and families down with them.

    3) Idiot #3: The Self Promoter - It's easy to find the Self-Promoters. By their very nature, they're in your face hawking their wares, lauding their recent market calls, and promising easy trading success. Open any trading magazine and you'll see their well-coiffed, grinning idiot faces leering at you, usually as part of a trading "event" that just happens to be selling all their products. The key to recognizing Self-Promoters is that they promote themselves, not ideas or methods. Indeed, a substantial number of them don't trade. Those include the "Trading Coaches" who promise to improve your confidence, but offer no concrete trading guidance that you could ever feel confident in. They also include the "Gurus" who tout simple chart patterns and indicators, carefully avoiding any possible objective testing of their wonderful setups. Self-Promoters never talk about how hard it is to achieve trading success; that would not sell well, especially among The Gamblers. Instead, they borrow their pitches from the "no money down" real estate guys and tell you how easy it will be to succeed with no capital. My take on Self Promoters? I don't mind people who deceive others; they're merely dishonest. It's the ones that deceive themselves that frighten me. That's when dishonesty becomes delusion.
  2. socalpt


    Doc doesn't realized that there are many traders out there trying to get into the market because they can't find a decent job to support their family, and those who can't trade longer beyond one day because they don't know how the market works; buying short is the only way to trade. I can feel for these people, money is money is money.

    Positive thinking and believing in yourself is the way to successful trading; short or long they all make money.
  3. Daytrading is a loser's game. The statistics show most daytraders will fail.
  4. ^^^^^^


    53.49% of all statistics are FALSE.
    Of those not false the mean statistic has a standard deviation of validity of nearly two thirds !
    Finally, the distribution of true statistics follows no known function.
    Therefore, your argument is refuted.
  5. All these threads are starting to sound the same

    ...the same...

    Am I the only one who noticed that the author of the article, is also an author of a trading book, and promoting himself by pointing out that he's a Phd...? ...seriously...?

    nice... I like your screen name...
  6. dac8555


    MORE GIBBERISH STILL!!! Do you think that there are 2 billion shares traded per day (per exchange) from people who are buying and holding?

    No, 95% of volume is institutional

    those institutions are trading intra day...GS, LEH, MS...yeah, the big boys.

    You going to tell me that goldman and sully are losers? they trade intraday. last year 40% of their profit was trading based (sales trading...but trading none the less).

    When you learn how things can comment. until then, you may learn and keep your mouth shut.
  7. +1

  8. Agree with you!! You'd better listen to stock-trad3r