* Locus of control – The degree to which a trader believes that the ability to be successful is within his or her control;
* Maximizing tendency – The degree to which individuals seek optimum outcomes from their decisions, not just outcomes that meet or exceed expectations;
* Regret susceptibility – The tendency to look back on outcomes of decisions and focus on negative aspects, creating regret;
* Self-monitoring – People’s tendency to track and control their own thoughts, feelings, and behaviors;
* Sensation seeking – The degree to which people seek varied and stimulating experience;
* Type A behavior – The degree to which individuals are driven to achieve.
The researchers set up a simulated trading exercise with real money payouts. Because data from only 32 subjects were collected, results must be considered preliminary.
Examining the personality profiles of the participants, the researchers found that the first two traits–locus of control and maximizing tendency–were not related to trading performance. Among the remaining traits, three clusters or personality types emerged:
1) Relaxed, risk-averse traders who avoid regret, dislike sensation-seeking, and show type-B (non achievement oriented) behavior;
2) Traders who were controlled risk takers: high in both self-monitoring and sensation seeking;
3) Achievement-driven traders who showed high Type-A personality traits.
Of the three groups, number three performed the worst. These highly competitive traders were also the most impatient in their decision making, reducing their effectiveness. The first two groups performed similarly–no significant difference. What this suggests is that a relaxed attitude toward performance may be more helpful than a driven one: the highly achievement-driven trader may create his or her own internal noise, interfering with sound decision-making.