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Academic achievers = Better traders?

  • #21
  • Jul 19, 2012 1:04am Jul 19, 2012 1:04am
Quoting Dopey
In trading there is no structure. A trader must create the entire system them self. This includes what hours to work, trading systems, mm systems, etc. I contend it's hard for everyone, but a few manage it, but even then they need guidance from someone who has done it.
True. Some do need to have their hands held, as did I in my early years of trading...

Quote
Just an aside, whenever someone has told me that they got nothing from uni, I always tell them they're right. Just because you go it doesn't mean you'll learn anything and it sure as hell doesn't translate into some sort of universal truth about higher education.

I'm not sure about US colleges, but I studied economics in the mid-90s at a top UK university known for economic research (at the time anyway), and I can say that very little I studied for was in any way practicable in my chosen profession.

I won't discount the usefulness of a college education but as far as my own experience goes, I rated it highly back in middle school and realized after 15-16 years of corporate life that perhaps I rated it too highly. That's just me, I guess.
I'm not trying to convince anyone. I'm not in the "convincing" business.
  • #22
  • Edited 1:17am Jul 19, 2012 1:05am | Edited 1:17am
Quoting Binyamin
Hi folks,

I know a lot of books written about trading say that there are no correlation. But if you notice, big multinational companies usually requires high CGPA for graduate positions and in some positions that needs experience they still look for high academic grades to fill the roles.

So we can conclude that they think that high grades = better employees. My question to you all is, do you think there are any correlation between academic grades and trading success??
This is one of the reasons I like this business: You definitely do not need to be well educated to get things working.

Just for your fun here is a large scale example how the education did not help at all http://en.wikipedia.org/wiki/Long-Te...tal_Management -> full of bright and well educated people (including Nobel prizes).

If I could be 25 years younger I would educate myself better but not in finance. I would do it in pshycology and mind/mental control. Maybe a year or two in a Hindu Temple would do the trick
  • #23
  • Jul 19, 2012 1:08am Jul 19, 2012 1:08am
Quoting skenobi
That, and poker! LOL

But, I think backgammon is more appropriate since (to me) it teaches how to handle rapidly changing circumstances (dice throws).

Poker (to me) teaches only how to "game" your opponents, which is not always useful in a "transparent" market like forex...

(apologies to the thread-starter... I don't want to throw the discussion off too much)
In poker we play the man, in trading we play the man within.
  • #24
  • Jul 19, 2012 1:11am Jul 19, 2012 1:11am
Quoting thelws
A good degree in uni just means you know how to pass tests well. Learning how to pass tests with flying colours is just a skill like trading. It can be learnt.

Good at learning != good at thinking.

But if you had a choice to choose 10 traders for your hedge fund out of a pool of 1000 first class honours and 20000 2nd class uppers, why not pick form the 1000 first class fellas?

That's the logic.
I agree that's the logic. At least that's what HR managers like to believe.

Experience teaches otherwise. Having been involved in hiring junior traders before for our prop team, I find that having the hardiest balls is a better indicator for future success rather than a first class... At least for the spot FX trading desk.

The quant desk, I'm not too sure!
I'm not trying to convince anyone. I'm not in the "convincing" business.
  • #25
  • Jul 19, 2012 1:26am Jul 19, 2012 1:26am
Quoting skenobi
Experience teaches otherwise. Having been involved in hiring junior traders before for our prop team, I find that having the hardiest balls is a better indicator for future success rather than a first class... At least for the spot FX trading desk.

Hardiest balls means someone that dare to take risk? Or can take a beating well?
Riding the order flow
  • #26
  • Jul 19, 2012 1:28am Jul 19, 2012 1:28am
Quoting Binyamin
Hardiest balls means someone that dare to take risk? Or can take a beating well?
Both!
I'm not trying to convince anyone. I'm not in the "convincing" business.
  • #27
  • Jul 19, 2012 1:30am Jul 19, 2012 1:30am
Quoting Binyamin
Hardiest balls means someone that dare to take risk? Or can take a beating well?
So it is not a miracle that old Vietnam veterans (today more Irak/Afghan?) did very well in this business... and are doing I think.

Fear control is in good condition.

2 persons in line another Phd and another a war captain. Which one could be the better trader we may ask... after teaching/self educating the basic techniques how to trade.
  • #28
  • Jul 19, 2012 1:31am Jul 19, 2012 1:31am
Quoting Prosentti
So it is not a miracle that old Vietnam veterans (today more Irak/Afghan?) did very well in this business... and are doing I think.

Fear control is in good condition.
I wouldn't be at all surprised.
I'm not trying to convince anyone. I'm not in the "convincing" business.
  • #29
  • Jul 19, 2012 1:56am Jul 19, 2012 1:56am
So skenobi or anyone here. If academic grades is not the best predictor of trading success, what will you look for in graduates that will ensure that you pick winners?
Riding the order flow
  • #30
  • Jul 19, 2012 2:04am Jul 19, 2012 2:04am
Quoting Binyamin
So skenobi or anyone here. If academic grades is not the best predictor of trading success, what will you look for in graduates that will ensure that you pick winners?

Speaking only for myself, of course, I'd be looking for the following:
1. gumption
2. any evidence of being an enterprising lil' scamster in the past.
3. likeability with just a dash of "assh0le" thrown in.

I'm not kidding.
I'm not trying to convince anyone. I'm not in the "convincing" business.
  • #31
  • Jul 19, 2012 2:06am Jul 19, 2012 2:06am
Quoting skenobi
Speaking only for myself, of course, I'd be looking for the following:
1. gumption
2. any evidence of being an enterprising lil' scamster in the past.
3. likeability with just a dash of "assh0le" thrown in.

I'm not kidding.
Haha, it is not something you can get them to admit in an interview unless you talk to their high school teachers.

Hmm, I wonder how being mischievous(lil scamster) helps.
Riding the order flow
  • #32
  • Jul 19, 2012 2:32am Jul 19, 2012 2:32am
Quoting Binyamin
Haha, it is not something you can get them to admit in an interview unless you talk to their high school teachers.

Hmm, I wonder how being mischievous(lil scamster) helps.
Well maybe "scamster" is a little over the top but definitely helps even if you're a borderline. Once you make the decision to work for Other People, then trading performance will not be the only thing you need to worry about. You will need to quickly adapt and find other ways of making money if your current way hits a dry spell for a while, and that means scheming against other Desks, against Management, against risk managers etc etc...

As for getting people to "admit" anything in an interview, they should not forget: the job sells itself. THEY're the ones who have to prove they deserve the job. If they're afraid to "admit" anything, then they don't have "gumption", which was my first requirement anyway.

Btw, if you're only trading for yourself, then the 2nd and 3rd requirement is just a "nice to have".
I'm not trying to convince anyone. I'm not in the "convincing" business.
  • #33
  • Jul 19, 2012 2:40am Jul 19, 2012 2:40am
Very nice discussion.

Having a good grade is a safe entrance to land you a good job but trading is a whole different world anyway.
  • #34
  • Jul 19, 2012 3:07am Jul 19, 2012 3:07am
There are 2 types of Academic people;
1. Someone who can absorb information and that's as far as they go.
2. Someone who can absorb information and create something new.

Then there are 2 types of Non-Academic people;
1. The manual/labor/workers who are non-creative.
2. The entrepreneurs/developers/inventors who are the creative thinkers.

In trading, it is the number 2's that mostly likely become successful.
  • #35
  • Jul 19, 2012 4:13am Jul 19, 2012 4:13am
Quoting CrucialPoint
There are 2 types of Academic people;
1. Someone who can absorb information and that's as far as they go.
2. Someone who can absorb information and create something new.

Then there are 2 types of Non-Academic people;
1. The manual/labor/workers who are non-creative.
2. The entrepreneurs/developers/inventors who are the creative thinkers.

In trading, it is the number 2's that mostly likely become successful.
Trading doesn't really need creativity
  • #36
  • Jul 19, 2012 4:20am Jul 19, 2012 4:20am
Quoting duyk20
Trading doesn't really need creativity
Sure... buy here , sell there... is that how easy trading is?
Maybe if someone hands us a complete idiot-proof trading system, then we really don't need our brains. Set and forget? and watch all the money roll in, hey

The creativity part is needed to understand the how's, the why's and to put it all together.
  • #37
  • Jul 19, 2012 6:24am Jul 19, 2012 6:24am
Hey skenobi,

Have you ever trader as a local on bursa? I'm thinking of jumping in now that they have lifted a lot of the cert requirements.
  • #38
  • Jul 19, 2012 8:32am Jul 19, 2012 8:32am
Whilst it is true that the top banks/hedge funds only want to hire someone with an MBA from Harvard or one of the other top 2O schools in the country, it is also true that academic success is diametrically opposed to success in trading.

Academic success is rooted in perfection. Some academic success comes from the ability to think in creative ways, but most academic success actually comes from the ability to regurgitate information perfectly. You are not going to have academic success if you don't pass tests. And you are not going to pass tests, if you get answers wrong. This may mean not challenging the person with the answer key, but let's take step back and focus on the fact that you don't get into Harvard with a "C" average. If you don't want a "C" average, then you need to focus on doing a perfect job on tests and assignments.

Simply, high academic achievers have not been rewarded for being wrong. It is all about being right.

Trading the markets is the exact opposite. There is loss in trading. Period. Trading is a losing game; he who loses best, wins. One can be a very successful trader losing 6 out of 10 trades on average. In the academic world, 6 out of 10 is a "D" at best and usually an "F". Many high academic achievers try to compensate by believing the market is something that can be "solved". This is not the case. The fact is that there will always be losing trades. No method of trading yet undiscovered will change this. If you cannot handle being wrong most of the time, then trading isn't for you. And most high academic achievers only know being right all the time. Trading is a wakeup call and many may not be able to pick up the phone........
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #39
  • Jul 19, 2012 9:55am Jul 19, 2012 9:55am
as Richard Dennis said creativity is needed when designing systems, optimize every second,but once you are through believe your system to be beyond further improvement ....then follow it like a dumb person, creativity at this point will ruin you.
this is where creative people fail...you have to be schizoid in your personality.
wo-yoy! wo-yoy! wo-yoy! wo-yoi! wo-yoy-yoy-yoy!
  • #40
  • Jul 19, 2012 10:16am Jul 19, 2012 10:16am
Regardless of ones achivements in academia, it takes a strong grip on reality to trade successfully and the will to achieve.

Observing the market, observing yourself, and observing your account(s) all while NOT applying a superficial reason as to why any event that alters any of these takes place.

Having a degree with years of study will have you looking at the charts through tinted glasses. All you've learned can distract from the reality of what is happening. Taking off the glasses would be the first step.

It's our ability to observe without bias and create a trade based upon what we've observed that will have us successful in this ROI quest.

I also agree with Crucial Point and HiddenGAP
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