It’s important to adopt a trading strategy that fits your personality. But first you need to define yourself as a futures trader. There are three basic trading personalities: the dominant trader, the detached trader and the dependent trader.
THE DOMINANT TRADER: My Way Or The Highway
The dominant trader thirsts to be in control. Intensely competitive, the dominant trader must win at all costs. He approaches everything in life as a contest to be won. Like a hunter, he is constantly scanning the market looking for weaknesses to exploit. Because he will do anything to win, the dominant trader assumes this trait in his competitors, causing him to be un-trusting. He views emotions with disdain as weaknesses. Anything that cannot be controlled must be ignored. The effort makes him even tougher and less flexible. Unfortunately, by ignoring his emotions, the dominant trader loses the ability to control their effects, which can affect his trading.
Dominant traders feel they are above the rules. They do not take orders or accept advice and may break the rules to have their way. Dominant traders are interested only in their own pontifications. They talk fast and loud and interrupt often. Their speech is punctuated with sharp, jabbing gestures. The goal of the dominant trader is to control every aspect of his world. Because the market cannot be controlled, the dominant trader is perpetually frustrated.
Personality Traits of the Dominant Trader
- ambitious, tough, independent, individualistic, status conscious, attention grabbing, manipulative, short tempered, closed minded, insensitive, impatient, angry.
THE DETACHED TRADER: Can I get back to you?
The detached trader abhors confrontation. He avoids conflict at all costs, ignoring problems in the hope that they will go away. Detached traders are so fearful of making a wrong decision, they make no decision. They are so afraid of losing or taking a risk, they fail to act. Detached traders prefer to live in their nicely ordered little rational worlds. They fear intimacy, rejection, risk, change, the uncertain, the unpredictable, the unordered. They live for facts and seek the soothing effect of order. In their world, everything must be quantifiable. Detached traders over-analyze and build complex routines or systems that they don’t have the guts to trade.
While independent, they readily accept rules imposed by authority, but find rigid obeisance necessary. About impersonal issues they can be open-minded, adjusting their opinion to match the facts; but about personal issues, they are rigidly unbending. Detached traders are good listeners and respectful of personal boundaries. They excel at solving problems based on logic. Unfortunately, the market is rarely logical so the detached trader lives in fear.
Personality traits of the Detached Trader
- fearful, orderly, predictable, rational, shy, aloof, objective, procrastinating, indecisive, stubborn, independent, inflexible, objective.
THE DEPENDENT TRADER: Whatever you say
Dependent traders are social animals who crave approval, acceptance and understanding. They are interested in people, interact effectively and listen well. They find it easiest to go along with the crowd and avoid confrontation. Often they enjoy talking about trading more than the actual trading.
Dependent traders like to help others. While popular, they can be very insecure and need constant reassurance which can make them exhausting to be around. They are drawn to the excitement and danger of the market but often think and act impulsively, always looking for the next hot tip.
Dependent traders may choose to defy the rules if they think them unfair. They have trouble assimilating information and suffer poor comprehension, which incites them to jump from program to program in search of the perfect trading system. Unfortunately, you cannot achieve success in the market with a sporadic approach so the dependent trader remains unsatisfied.
Personality traits of the Dependent Trader:
- warm, friendly, cooperative, compliant, popular, insecure, jealous, empathic, compulsive, unfocused, impulsive.
To become a successful futures trader you have to understand what makes you tick. There are strengths and weaknesses in each basic personality type and you may see yourself in more than one type. If you can honestly assess and face your strengths and weaknesses, you can control them, not be controlled by them. You must KNOW YOURSELF to succeed as a futures trader.
