Archives of “temperament” tag

rss

Personal Strengths and Weaknesses

  
  Education
#  #  #  #  #  #  #  #

We all have different personal strengths and weakness.  Many people focus on transforming a weakness into a strength. While that is admirable, the reality is that it’s not always possible. Although I agree with the basic idea of brain plasticity, and I whole-heartedly agree with the idea of always striving for self-improvement, I also know that as humans we have a certain degree of natural-born temperament and not everything about us can be changed.

Although we can’t always build or change every weakness into strength, the good news is that we can always leverage our strengths, if we know how. And that is mighty powerful. It’s so powerful that if you leverage the right strengths in the right way they can do an excellent job of not just counter-balancing your weaknesses, but can propel you so far ahead  that those weaknesses pale in comparison.

One of the most powerful things you can do for yourself is identifying your natural strengths and then work to see how you can build on them.

We all have different personal strengths, and knowing how to leverage them is an important part of successful trading. A major consideration here is that you try to identify and leverage your own personal strengths, and not simply copy someone else’s. All too often I see struggling traders running from one style to another style whenever they see someone else’s success. One of the primary reasons why copying someone else’s trading style doesn’t always pay off in trading is because of different personal strengths.

Personal strengths and Weakness

  
  Education
#  #  #  #  #  #  #  #

We all have different personal strengths and weakness.  Many people focus on transforming a weakness into a strength. While that is admirable, the reality is that it’s not always possible. Although I agree with the basic idea of brain plasticity, and I whole-heartedly agree with the idea of always striving for self-improvement, I also know that as humans we have a certain degree of natural-born temperament and not everything about us can be changed.

Although we can’t always build or change every weakness into strength, the good news is that we can always leverage our strengths, if we know how. And that is mighty powerful. It’s so powerful that if you leverage the right strengths in the right way they can do an excellent job of not just counter-balancing your weaknesses, but can propel you so far ahead  that those weaknesses pale in comparison.

One of the most powerful things you can do for yourself is identifying your natural strengths and then work to see how you can build on them.

We all have different personal strengths, and knowing how to leverage them is an important part of successful trading. A major consideration here is that you try to identify and leverage your own personal strengths, and not simply copy someone else’s. All too often I see struggling traders running from one style to another style whenever they see someone else’s success. One of the primary reasons why copying someone else’s trading style doesn’t always pay off in trading is because of different personal strengths.

Emotional Intelligence v Intellectual Intelligence in trading.

  
  Education
#  #  #  #  #  #  #  #

What is more important for success as a trader – A high level of Intellectual Intelligence, or a high level of Emotional Intelligence?

Warren Buffett once said; “Success in investing doesn’t correlate with I.Q. once you’re above the level of 25. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing“.

 Very briefly emotional intelligence can be defined as an ability, skill or a self-perceived ability to identify, assess, and control the emotions of oneself, of others, and of groups. 

 Broadly speaking intellectual intelligence can be defined an academic or cognitive intelligence. Resing and Drenth (2007) use the following definition: “The whole of cognitive or intellectual abilities required to obtain knowledge, and to use that knowledge in a good way to solve problems that have a well described goal and structure.”

Following my Parameters

  
  Education
#  #  #  #  #  #  #  #  #  #  #  #  #  #  #

1) Relative Strength or Weakness- there’s no reason for me to pick from the mushy middle, as the biggest movers come from the best and worst 5% of the market.

2) Abnormal Volume- it can be abnormally high or abnormally low, but I’m looking for stocks that are doing something different that they’ve done in recent days or weeks.

3) Abnormal Range- again, high or low tells me something…average tells me nothing.

4) Identifiable Support(Longs) or Resistance(Shorts)- I have no need to be the first, that’s for the really brave and really smart(maybe).  If the idea is that good, I’ll have days/weeks/months to milk it…in case you haven’t heard, the second mouse gets the cheese.

4) News Absorption- I like to participate AFTER news events…it gives me a good idea of the temperament of a stock’s owners. It may have broken out from a base.  It may have been crushed but then built a base.  It may have reacted poorly to a “great” report. In any case, I want to see how a stock reacted the last time there was real news, and position myself on the side that has taken control since then.

6) Doubt- this is a tricky one, but our ideas should not be SO obvious that our relatives and neighbors love the idea.  Buy worry, short hope.  Buy after panic, short after euphoria.  I’m not saying to ignore an idea because your Twitter stream agrees with you…haven’t we filtered our list to only those we respect?  But take a second to check your spot on this curve, and where you sit on this idea.

Personal Strengths and Weaknesses

  
  Education
#  #  #  #  #  #  #  #

We all have different personal strengths and weakness.  Many people focus on transforming a weakness into a strength. While that is admirable, the reality is that it’s not always possible. Although I agree with the basic idea of brain plasticity, and I whole-heartedly agree with the idea of always striving for self-improvement, I also know that as humans we have a certain degree of natural-born temperament and not everything about us can be changed.

Although we can’t always build or change every weakness into strength, the good news is that we can always leverage our strengths, if we know how. And that is mighty powerful. It’s so powerful that if you leverage the right strengths in the right way they can do an excellent job of not just counter-balancing your weaknesses, but can propel you so far ahead  that those weaknesses pale in comparison.

One of the most powerful things you can do for yourself is identifying your natural strengths and then work to see how you can build on them.

We all have different personal strengths, and knowing how to leverage them is an important part of successful trading. A major consideration here is that you try to identify and leverage your own personal strengths, and not simply copy someone else’s. All too often I see struggling traders running from one style to another style whenever they see someone else’s success. One of the primary reasons why copying someone else’s trading style doesn’t always pay off in trading is because of different personal strengths.

Typical Traits Of Top Traders

  
  Education
#  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #

Temperament – In general, people with more analytical and even tempered personalities make better traders.

There is a counterbalancing trait which is the willingness to take risks. Some traders with volatile temperaments are successful because they can take risks easily and can keep trading after getting knocked down. They also tend to blow up more often.

Character – Humility is a very important ingredient in trading success. The truth does not care what you think of yourself. The markets don’t care what you want to believe reality is. Trader’s that are humble are better able to examine their methods and trading objectively and make changes where appropriate.

I’ve known a lot of successful traders that most people might consider arrogant but when it comes down to their own success and the reasons for that success they were able to see the faults in themselves and their trading. The trader’s that were out of touch with reality tended to blow up and have short-lived success.

Intelligence – General intelligence is correlated with success but not as highly as you might think. The ability to discern patterns and relationships with limited information is very useful.

I’d say that you need to be relatively smart to be successful but not extremely smart. Smart enough to understand the principles but beyond that it doesn’t necessarily help you. I’ve seen many very smart people tie themselves up in knots by second-guessing themselves.

Social Skills – Most of the really successful traders are not very socially skilled. Many tend to be reclusive and introverted. There are some exceptions. (more…)

Personal Strengths and Weaknesses

  
  Education
#  #  #  #  #  #  #  #

We all have different personal strengths and weakness.  Many people focus on transforming a weakness into a strength. While that is admirable, the reality is that it’s not always possible. Although I agree with the basic idea of brain plasticity, and I whole-heartedly agree with the idea of always striving for self-improvement, I also know that as humans we have a certain degree of natural-born temperament and not everything about us can be changed.

Although we can’t always build or change every weakness into strength, the good news is that we can always leverage our strengths, if we know how. And that is mighty powerful. It’s so powerful that if you leverage the right strengths in the right way they can do an excellent job of not just counter-balancing your weaknesses, but can propel you so far ahead  that those weaknesses pale in comparison.

One of the most powerful things you can do for yourself is identifying your natural strengths and then work to see how you can build on them.

We all have different personal strengths, and knowing how to leverage them is an important part of successful trading. A major consideration here is that you try to identify and leverage your own personal strengths, and not simply copy someone else’s. All too often I see struggling traders running from one style to another style whenever they see someone else’s success. One of the primary reasons why copying someone else’s trading style doesn’t always pay off in trading is because of different personal strengths.

Three of Buffett’s rules

  
  Education
#  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #  #
  • Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.
    If you lose money on an investment, it will take a much greater return to just break even, let alone make additional money. Minimize your losses by finding quality companies that are temporarily selling at discounted prices. Then follow good capital management principles and maintain your trailing stops. Also, sitting on a losing trade uses up time, money and mental capital. If you find yourself in this situation, it is time to move on.
  • The stock market is designed to transfer money from the active to the patient.
    The best returns come from those who wait for the best opportunity to show itself before making a commitment. Those who chase the current hot stock usually end up losing more than they gain. Remain active in your analysis, look for quality companies at discounted prices and be patient waiting for them to reach their discounted price before buying.
  • The most important quality for an investor is temperament, not intellect.
    You need a temperament that neither derives great pleasure from being with the crowd or against it. Independent thinking and having confidence in what you believe is much more important than being the smartest person in the market. Most of the time, the best opportunities are found when everyone else has given up on the stock market. Over-confidence and emotion are the enemies of a high quality portfolio.
Go to top