Wednesday, September 22, 2010

Luby: Education of a Trader

Bill Luby at Vix and More (link) has an interesting entry about the education of traders, and his own journey.

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As I see it, all traders are ultimately self-taught. There are no required classes, readings, homework assignments or even a syllabus with recommendations. Tests are administered on a daily basis, frequently with multiple tests on the same day. Worst of all, everyone is graded on an unfavorable curve in which there are more Fs than As.

Against this backdrop, education counts, but skill and experience count even more. An insatiable curiosity helps, as does a willingness to explore unfamiliar territory. Great trades, insights and strategies present themselves in somewhat random fashion and, as Louis Pasteur observed, “Chance favors the prepared mind.” ...
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Readers of my blog that have been with me from the beginning (over three years ago) can see an evolution in the types of trades that I take on. Keeping some kind of trading journal can be instructive for review. It helps a person learn from the past. Often times I find it is the emotional state to be a key indication of a winning or losing trade.

As I've written a few times, there are a lot of ways to skin a cat, a thousand ways to make money in the markets. Finding a style that suits a person's personality is a key. Try to copy someone else, or fit into a style that isn't the real you, and it will twice as hard.

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