My name is Marek Hawk and I am a professional trader of Horizon Trading Team. In today’s article, I write about general topic, however, even more entertaining one. Who is a trader? Sometimes I get this question from surprisingly glowering faces after I answered to the query “What do you do for living?”. Simple answer “I am a trader!” never seems to be satisfying to eager minds. This experience inspired me to write this composition. So again, who is a trader? What is my job about and why do I find it interesting? What is the potential? Keep reading and I will show you!
We as a trader, we are persons who trade (buy and sell) financial assets on the financial markets for ourselves or on behalf of another person or institution. We trade currencies crowd circulate when they shop, we trade oil humankind need for cutting destinations, we trade companies people work for each day. Successful traders possess entrepreneurial spirit who observes the world and can take advantage of it.
I always have been perceiving a trader as a strong individual who is fully accountable for his results. The person who knows how to behave in the most appropriate way in given circumstances. Only based on his judgement he can make money on the markets. It is not a superpowered individual, just a human being with common sense, strong discipline and brutally honest self-reflection.
What is trader’s job about?
What is trader’s job about? I believe the most accurate answer could be: “To be prepared as much as you can and to stick to the plan!” Every day is different, we work only with predictions of uncertain outcome, therefore trading is very exciting! Despite I enter the trading room, or open the laptop on the way, with the projection of systematic executions of my trading day, in the end every day I live experience with the markets, with my trading partners, being grateful for learning something new. Of course, the results should be always in-line with planned money cash-flow scenarios – trading shouldn’t be too much exciting or wild eventually, a trader always needs to act like a strong strategic player.
People usually link trader’s job to an indoor activity, big screens and charts. It can be like that in case of institutional or proprietary traders, nevertheless I met traders working on the roads or trading from exotic destinations. Therefore, at first place, I always felt that trader’s job is about freedom of expression through a such complex being, the markets. It is said that trader meets himself through the markets, the place of living form of uncertainty. I like Mark Douglas’s work about trader’s mindset which get you closer to what our job includes.
“One of the many contradictions of trading is that it offers a gift and a curse at the same time. The gift is that, perhaps for the first time in our lives, we’re in complete control of everything we do. The curse is that there are no external rules or boundaries to guide our structure, our behaviour… The very reason we are attracted to trading in the first place – the unlimited freedom of creative expression – is the same reason we feel a natural resistance to creating the kinds of rules and boundaries that can appropriately guide our behaviour. It’s as if we have found a Utopia in which there is complete freedom, and then someone taps us on the shoulder and says, “Hey, you have to create rules, and not only that, you also have to have the discipline to abide by them.”
– Mark Douglas
If I start to think about traders themselves, I believe all traders I met live their own version of expression with all personality nuances included. The way how they approach the markets, the strategies they trade or a workflow of their trading business, it is always original. Traders who can trade on the roads, with their mobile phones platform in their hands, traders with a powerful notebooks ready to scalp abroad in a restaurant on the beach, a great trader who flies through the countries with a desktop only, ready to smash the stock markets after he plugs a power cable to his computer and after he finds appropriate trading screen, mouse and keyboard - yes, it takes him time... By the way, I never convinced this man, who is travelling a lot, to buy a laptop for his trading on the roads. What a disciplined trader to his codex! What I wanted to make understandable by this essay, by their personality traits, they create their own game in their minds and reflect the game into reality.
“You create your own game in your mind based on your beliefs, intents, perception and rules.”
― Mark Douglas
Still and all, in spite of their originality, I found very fascinating they all possess the key common fundamental attributes, the pattern how they approach their business to be long-term winners. They are trading disciplined in the zone.
“I AM A CONSISTENT WINNER BECAUSE:
- I objectively identify my edges.
- I predefine the risk of every trade.
- I completely accept the risk or I am willing to let go of the trade.
- I act on my edges without reservation or hesitation.
- I pay myself as the market makes money available to me.
- I continually monitor my susceptibility for making errors.
- I understand the absolute necessity of these principles of consistent success and, therefore, I never violate them.”
― Mark Douglas, Trading in the Zone
Back to the original question, what is trader’s job about? We just touched the core of psychology of our business which is ultimately 80 % of our success. Naturally it is about building the technical skills as well, but without proper mindset, you cannot succeed.
Trader’s Technical and Fundamental Skills
This our analytical part of our job, statistics, math and news reviews. All traders I met use technical analysis. And for me it is an alpha and omega for identifying edges on the markets. I believe a trader must define his structured competitive advantage, his edge, covered by statistical results, which transforms into his successful trading business. Technical or fundamental analysis must provide you risk projection covered by numbers. Solely after that, a trader can make professional judgements.
It does not matter what kind of technical or fundamental analysis a trader operates with. It ought to provide the goal of its purpose, statistical advantage. Either a trader works with moving averages, momentum indicators, oscillators, Fibonacci projections, price action, tape reading analysis or anything different, or uses for example balance sheet analysis or other quantitative methods. It is up to every trader what he will choose and what kind of combinations he is going to utilize. It is only about his freedom of expression.
"Attitude produces better overall results than analysis or technique. If you have the right attitude, everything else about your trading will be relatively easy, even simple, and certainly a lot more fun." – Mark Douglas
Attitude is what makes an individual a trader, the approach how he is dealing with his technical and fundamental skills, the way how he builds his statistics, probabilities and risk calculations. One of my best friends, a great person, who introduced me to the world of trading, he has never got this unfortunately. We were trading together, though he was not able to create a plan for his strategy, let alone build the statistics. I am successful and progressing, he is still in is job. To be a trader, one must bring whatever it takes, we must do our homework. With progressive outcomes one starts to love this necessity.
Trader’s Lifestyle and Potential
Final and the most interesting aspect of trading for me – lifestyle. As already mentioned, trading is about freedom and self-expression. It is up to everyone how he will express himself through the markets, it can be in structured or random manner, with or without the edge. The same applies to trader’s lifestyle.
One of my teachers, let’s call him the trader traveller, he lives abroad, visits exotic places, leaving his money to work for him. He started as a day trader and in the end moved to automatic trading systems. The traveller managed it very well indeed. I think he would sign up to this Mr. Elder’s quote without hesitation:
In the contrast, my lifestyle expression is about performance in the moment. If you hope that you find some cool stories about partying, rush life etc., I will disappoint you. It can happen if I want, because I am free. Although this is not my expression. For me is important trading itself and what the kinship hands over. I am disciplined.
Traders are often compared to professional athletes. It is very demanding and competitive job, so I wisely chose the lifestyle which supports my goals. Trade to win and bring yourself to own potential, not only in trading, even so in other spectrums of life. There are not many activities when we can find so much about ourselves. It is said that trading involves spiritual aspect, I agree.
“I define "winning" as maximising your own potential, as seeing the world realistically, and as living life like the miracle it is.” — Ari Kiev
I have not mentioned one of the aspects of trading connected to lifestyle – money. Obviously good earnings can bring us dream lifestyle and trading is a scalable business. We make as much money as markets let us. What we can do about it, it is only a bringing ourselves to our potential. We can travel, let our money work for us, be part of a team, trade at our homes or wherever we want. We are free to express.
As traders, we can calculate the potential because we are Masters of Risk. We have inputs, our capital, the edge and statistical fundamentals, trading plan including risk and money management. Now we have the potential, it is almost unlimited.
In today’s unusual article I brought the insight answering the question “Who is a trader?”. Through the lenses of psychological theory and from my best practice I described a trader. Despite the fact that trading is about our own unique expressions, we observe the common characteristics what makes a person a trader. To be successful traders, we need the absolute necessity of the mentioned principles of consistent success.
I touched the core of technical and fundamental aspects and gave the reasons why these elements are just a support of our trading mindset. In this field, we operate only with statistic data, calculated risks and rewards.
One of the most interesting part of trader’s job is his lifestyle. Driven by his self-expression, a trader can choose the lifestyle he wants. I took you closer to trader’s lifestyle mindset.
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