Evidently you are unfamiliar with the use of self-deprecating humor so as not to be seen as overly arrogant. I consider myself quite a competent investor but that neither validates nor invalidates the superiority of passive investing over trading. I wish you and jupiter good luck in your trading since you seem opposed to investigating the merits of indexing yourself.
Thanks , but you misunderstand. This thread is not some sort of backwards way of asking for help in trading. It's meant to give insights and suggestions for those traders who are realizing that trading is not what it's cracked up to be.
Howard Gardner wrote a book in which he listed seven kinds of intelligence in humans: 1.) Verbal-linguistic - writers, journalists 2.) Logical-mathematical - mathematicians, engineers 3.) Visual-spatial - architects, artists 4.) Musical 5.) Intrapersonal - philosophers, psychologists, theologians 6.) Interpersonal - politicians, sales 7.) Bodily-kinesthetic - athletes, dancers, soldiers, surgeons SAT & ACT tests only measure the first three. If you get a high score you are considered "smart". But, in reality you are only certified smart in those three areas. Some people dismiss the bottom four as skills or talents. But that is inaccurate as they require complex interaction within the brain or between the brain and body. A seven foot hulk who does not have bodily-kinesthetic intelligence will be useless on the basketball court against a 5'9" player with superior bodily-brain interaction. In my opinion, discretionary trading requires superior intelligence in the intrapersonal, visual-spatial and bodily-kinesthetic areas (in decreasing importance). It is frustrating for someone who is "smart" by traditional measures not to be able to get trading. But, the way one should look at it is - just because you have a high SAT score, does that mean you will become a great musician if you dedicate yourself to the task? Possibly, but not always. You have to have musical intelligence. All this being said, you could have the skills but they haven't come to the surface yet, so you should not give up. On the other hand, if it does not feel right, you may just not have the needed ingredient and there is no shame in walking away, just as you would if you decided that you were not cut out to be a musician.
Well said. And you can't overemphasize that this is a performance discipline like being a top notch professional athlete... it's possible to learn most of what you need to be successful but in the end it comes down to a handful of very small seemingly insignificant things that have to be done right every time. People misunderstand and think trading is an intellectual pursuit and they are doing to succeed because they are smart. It's really not about that... it's far more about psychology and discipline. I have seen some incredibly smart people fail as traders because they just weren't cut out for it, and I know lots of guys who really aren't the brightest bulbs in the box who make comfortable 6 figure incomes year after year. Good post indexer.
And, automated trading is a different animal. Here, the intelligence (skill) required is mostly logical-mathematical. That is why the hedge funds hire physicists and mathematicians. Floor trading requires bodily-kinesthetic, logical-mathematical and interpersonal intelligence. In the pit, you have to get noticed, read others and properly signal your trade. You have to figure math in your head and you have to have the political skills to get others to trade with you (or feed you orders). Many floor traders who tried to become screen traders did not make it because they did not have the right intelligences (skills) to make the transition. Many off floor traders got taken to the cleaners in the pit like Trader Vic described in his book when he visited the CME.
There is only one intelligence, which get developed and is seen in various skills in various field. The above classification of intelligence, and the inclusion of non-intelligence into intelligence, is bullshit to say the least. Probably the guy made that classification because it sells as every dick, tom and harry can say "I am intelligent because my left arm is strong because I am intelligent."
I can tell you that I know basically next to nothing about trading and still made over $3K this week (trading only in the AM) by following the real-time exit and entry signals of a visual-spatial, logico-mathematical, intrapersonal genius