What trader type are you?
From Buzzy Schwartz to Ray Dalio, the great names of trading all share very different characteristics. Which one are you?
The Champion Day Trader– “Buzzy” Schwartz”.
Marty Schwartz’ trading was at one time accounting for 10% of the volume per day on the S&P 500 futures contract. He is the author of “Pit-bull, Lessons from Wall St’s Champion Trader”.
Marty Schwartz’ trading was at one time accounting for 10% of the volume per day on the S&P 500 futures contract. He is the author of “Pit-bull, Lessons from Wall St’s Champion Trader”. To the uninitiated, the champion day trader may seem like a person of action. But they are just as comfortable stalking their trade as they are decisive when it comes time to execute. Typically surrounded by multiple screens, the day trader monitors dozens of inputs waiting for a trade with an edge to appear. Some trade rapidly, in and out of the market in a heartbeat, taking 5 pips here, 10 pips there. Others may be more serene, placing only one or two trades per session, carefully waiting for the optimal time to catch the day’s move. The champion day trader may be boisterous and rowdy, but they have learned to separate their ego from the trade. If the market does not go for them? They’re either out, or going back the other way. To the day trader, it’s all the same. What matters is whether they cut their losses short and let their profits run – not whether they are right. They may only win with half of their trades, but through superior risk management they end each day well in the black. Pepperstone Trading Style: Short-term/Intra-day
The Consummate Technician – W.D. Ganns
William Delbert Gann was famous for his ability to forecast market moves using technical analysis.
The charts weave a compelling story to the technician, who knows that technical patterns provide a window into the market’s soul, and a snapshot of its psychology. It’s through technical analysis that they surf the waves of market participants’ fear and greed. Be it Fibonacci, Elliot Wave or Gann theory, the technical analyst has the tools to help them predict the market’s near future, and the skills to implement a winning trade based on their ideas. The Technician’s charting ability has numerous applications. They are able to analyse both short and long-term moves. Some will combine their technical analysis with fundamentals, trading primarily when both are in alignment. Others trust the price. They trade first and seek reasons later, if they need to at all. The technician’s charts are brightly adorned with trend lines, moving averages, stochastics and MACD. But underneath it all is a beautiful simplicity that guides them to trade with accuracy and aplomb. Pepperstone Trading Style: Technical Analysis
Master System Trader – Ed Seykota
Ed Seykota is a system trader beyond compare. He understands that trading is about psychology first and the system second
The master system trader is the god of the trading machines. Through a rigorous process of development and testing, the system trader has automated his trading strategies so his computer does his trading for him. A picture of discipline, the master system trader sits calmly though rough periods, knowing that when the trends come his profits will be large. He is in a research war. Markets change, and as they do, his systems need to adapt. This means he spends much of his time in research, rather than trading. That is unless he is away roaming the world, as the master system trader is prone to do. His machines afford him the luxury of plenty of free time. Pepperstone Trading Style: Expert Advisors
The Global Macro Whizz Kid – Paul Tudor Jones
Famous for predicting the black Monday crash in 1987, the billionaire Paul Tudor Jones is now the founder of the philanthropic Robin Hood Foundation.
Famous for predicting the black Monday crash in 1987, the billionaire Paul Tudor Jones is now the founder of the philanthropic Robin Hood Foundation. The Global Macro Whizz Kid might seem like a genius on the surface, trading big market moves with skill and tenacity. But the best global Forex traders know that it is hard work and discipline that has led to their success. They search tirelessly for opportunities in currencies, indexes, and commodities, and then they work even harder to ensure the best risk/reward profile for their trade. They understand that the idea is only going to get them so far, and that implementation is the key. Able to be profitable in all market types, the best global macro traders (the true whizz kids) never have a losing year. Pepperstone Trading Style: CFD’s (Indices and Commodities) and Currencies
The Hedge Fund Maestro– Ray Dalio
Ray Dalio is the founder of the world’s largest hedge fund, Bridgewater Associates. In 2012, Dalio appeared on the annual Time 100 list of the 100 most influential people in the world and is said to be worth over $15.2 billion.
It takes a leader to build a successful hedge fund, but it takes true leadership to build a business based on its people. Maestros are experts in selecting traders who fit their criteria, be they mechanical, macro or quant. They are risk managers first and foremost, with each trader having their place in a greater risk management plan. Traders that are performing exceptionally well are allocated more funds, while allocations are cut to those that are not. The hedge fund maestro knows that as a team, traders are capable of producing returns far greater than the sum of their component parts
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