Afraid to Trade - Match Your Trading Style with the Market: 'If you're a deep thinker, you'll lose money sitting at the trading table'
If you’re a developing trader, how would you describe your trading style?
Dr. Brett Steenbarger posted good article about it: he lists a few pitfalls that occur when the market environment shifts and a trader fails to adapt and falls into a slump.
"You can't win if you're not playing the right game. How can we sit at the wrong trading table? Several variations of this challenge immediately come to mind:
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You're a momentum trader and you're trading a slow, low volatility market;
- You're a trend trader and you're trading a choppy, range market;
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You're a research-oriented big picture trader and you're getting caught up in short-term price action;
- You're a skilled short-term trader and you're locked in a longer-term directional market view;
- You're a contrarian fader and you're getting run over in high volume directional flows;
- You're an independent thinker, but you're distracted and influenced by the views of others;
- You're a trader who reads others well at the table, but you're isolated from other traders.
A great way to lose money is to not understand yourself and how you're wired cognitively. If you're a deep thinker, you'll lose money sitting at the trading table. If you're a fast thinker, you'll lose money dabbling with investment theses. The route to success is to be who you are when you're functioning at your best. Working on improving your discipline, controlling your emotions, and following your process is not helpful if you're sitting at the wrong table to begin with."
