Trade and individuality about three years ago, I, along with Linda Raschke considered a group of about 64 active traders. We wondered if there were any individual characteristics and recurring styles that distinguish more successful from less successful traders. We received a large number of results that make you think. For example, we found that successful traders had lower levels neuroticism (negative emotional experience) than their less successful colleagues. They also used methods are more focused on problem solving (developing strategies to deal with problematic situations) by compared with the concentration on their emotions. Successful traders, as we discovered, were more highly rated on a scale of 'integrity', reflecting the motivation to follow their plans and commitments. Overall, these results confirms what many of us have seen in my career on the market: traders, who tempers his emotions and act on the basis of his plan, and sell better than their more emotional and impulsive counterparts.
However, there was a surprising finding in our study, which consisted in the fact that a disproportionate number of successful traders – about half – said the use of mechanical trading systems. From unsuccessful traders, none used a mechanical approach. When I later interviewed the successful traders, it turned out that even those who were not committed to trading systems that base their trades on the models that they thoroughly investigated. On the contrary, almost all unsuccessful traders lacked such training in relation to the models and studies. Psychology rules What is a mechanical trading system? Basically, a set of trading rules.